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

Commission File Number: 1-15174

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			2
Interim group management report			3
Condensed Interim Consolidated Financial Statements			41
Notes to Condensed Interim Consolidated Financial Statements			47
Supervisory Board and Managing Board			74
Review report			75
Quarterly summary			76
Financial calendar			77

     

Introduction

     Siemens AG’s Interim Report for the Siemens Group complies with the applicable legal requirements of the German Securities Trading Act (Wertpapierhandelsgesetz — WpHG) regarding quarterly financial reports, and comprises Condensed Interim Consolidated Financial Statements and an Interim group management report in accordance with § 37x (3) 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 for fiscal 2010, which includes a detailed analysis of our operations and activities.

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

Key figures Q3 and first nine months of fiscal 2011^1,2

(unaudited, in millions of €, except where otherwise stated)

Interim group management report

Overview of financial results for the third quarter of fiscal 2011
(Three months ended June 30, 2011)

	•		Orders climbed 20%, to €22.937 billion, and the order backlog reached a new high of €96 billion. Orders were up 25% on an organic basis, excluding currency translation and portfolio effects.
	•		Revenue rose 2%, to €17.844 billion, with increases in all regions driven by emerging market growth. Organic revenue grew 8% compared to the prior-year period.
	•		Total Sectors profit was €1.144 billion, including strong profit growth in Industry and burdens on profit of €682 million related to an arbitration decision and €381 million related to particle therapy projects.
	•		Income from continuing operations was €763 million and corresponding basic EPS was €0.83.
	•		Free cash flow from continuing operations was €992 million, down from €2.088 billion in the prior-year period due in part to a build-up of net working capital associated with growth.

     Management’s perspective on third-quarter results. We continued to grow in the third quarter and believe that we are on track to reach our targets for fiscal 2011. New orders again rose sharply, driven by a large order at Mobility. We are vigorously tackling operating challenges. Our markets are still robust, although risks are tending to increase in the global economic environment.

     Strong order intake lifts backlog to new high. Orders climbed 20% compared to the third quarter a year ago, led by a €3.7 billion contract for trains in Germany. This helped lift the order backlog (defined as the sum of order backlogs of our Sectors) to a new high of €96 billion at the end of the quarter. Third-quarter revenue rose 2% year-over-year. Currency translation effects took 5 percentage points from reported growth in both orders and revenue for the quarter. Currency translation effects had a particularly strong influence on reported results including for the U.S., India and China. On an organic basis, excluding portfolio effects along with currency translation effects, orders increased 25% and revenue rose 8% year-over-year. The book-to-bill ratio for Siemens overall was 1.29.

     Rolling stock contract drives order growth. The large order for trains noted above helped lift Industry orders by more than 50% compared to the same period a year ago. Energy orders were nearly level year-over-year. Healthcare orders for the third quarter declined in a challenging environment. On a geographic basis, substantial order growth came from the region comprising Europe, the Commonwealth of Independent States (C.I.S.), Africa and the Middle East, due to the trains order mentioned above, and from the reporting region Asia, Australia, including double-digit increases in China and India. On a global basis, orders in emerging markets grew 5% compared to the prior-year period and accounted for €6.378 billion or 28% of total orders for the quarter. On an organic basis, third-quarter emerging market orders were up 12% year-over-year.

     Revenue rises in all regions, led by emerging markets. Third-quarter revenue rose in Industry, including double-digit increases at Drive Technologies and Industry Automation, and in Energy, including double-digit increases at Fossil Power Generation and Oil & Gas. Reported revenue in Healthcare came in lower compared to the prior-year period due primarily to strong negative currency translation effects and a significant revenue reduction effect related to particle therapy projects. On a geographic basis, demand in emerging markets took revenue higher in all regions. Revenue in emerging markets globally grew faster than revenue overall, at 8% for the quarter, and accounted for €5.897 billion, or 33%, of total revenue for the quarter. On an organic basis, third-quarter emerging market revenue was up 14% year-over-year.

     Total Sectors profit burdened by impacts in Energy and Healthcare. Total Sectors profit in the third quarter came in at €1.144 billion, down from €2.067 billion in the same period a year earlier due to substantial profit impacts affecting the Energy and Healthcare Sectors. Following Siemens’ previous decision to exit its nuclear power joint venture with Areva S.A., an adverse arbitration decision resulted in a payment to Areva. This had an associated profit impact of a negative €682 million within the Fossil Power Generation Division. Profit in Healthcare included €381 million in negative impacts resulting from a reevaluation of the commercial feasibility of particle therapy for general patient treatment.

     Industry increased its third-quarter profit 23% year-over-year, to €872 million. While the Energy Sector delivered another strong operating performance, the negative impact related to the arbitration decision mentioned above held third-quarter profit to €263 million, down from €875 million a year earlier. Similarly, Healthcare’s reported profit was €8 million, primarily due to the profit impacts mentioned above. For comparison, Healthcare profit of €482 million in the third quarter a year earlier benefited from a €40 million effect related to a joint venture.

     Total Sectors profit takes income down. Income from continuing operations was €763 million, down from €1.428 billion a year earlier. Corresponding basic earnings per share (EPS) were €0.83 compared to €1.62 a year earlier. These declines were due largely to the profit impacts discussed above for Total Sectors profit. Net income in the current quarter declined to €501 million from €1.435 billion in the same period a year earlier. Corresponding third-quarter EPS decreased to €0.53 from €1.62 a year earlier.

     Within net income, discontinued operations swung to a loss of €262 million from income of €7 million in the prior-year period. The largest factor was a loss of €305 million attributable to Siemens IT Solutions and Services. In the prior-year period, the result within discontinued operations related to Siemens IT Solutions and Services was a loss of €62 million (for more information see “Portfolio activities” below). Income from discontinued operations related to OSRAM was €56 million in the third quarter, down from €74 million in the same period a year earlier. On a slight increase in revenue year-over-year, OSRAM’s operating results declined substantially due to a combination of factors, including higher costs for raw materials and pricing pressure. A positive effect from cessation of depreciation and amortization resulting from classifying OSRAM as discontinued operations more than offset expenses for legal matters.

     Growth in net working capital lowers Free cash flow. Free cash flow from continuing operations came in at €992 million, down from €2.088 billion in the prior-year period. The change was due primarily to a build-up of net working capital in the Sectors associated with growth, including a build-up of inventories. Free cash flow from discontinued operations was a negative €131 million compared to a positive €41 million in the prior-year quarter. Free cash flow came in lower at OSRAM and Siemens IT Solutions and Services, including payments related to carve-out activities and personnel-related matters in connection with establishing Siemens IT Solutions and Services as a separate legal group. The Free cash flow measure does not include certain cash outflows that occurred in the third quarter. Among these were a payment of €1.0 billion related to a previously disclosed purchase of additional shares in Siemens Ltd. in India, and a payment of €0.7 billion related to the arbitration decision as mentioned earlier.

     ROCE declines on lower income from continuing operations. On a continuing basis, ROCE (adjusted) declined to 11.3% in the third quarter from 17.0% a year earlier. The decrease was due to lower income from continuing operations compared to the prior-year period driven by the negative profit impacts associated with the arbitration decision and particle therapy projects mentioned earlier. These effects were only partly offset by a reduction in average capital employed compared to the prior-year period.

     Pension underfunding remains near level of second quarter. The estimated underfunding of Siemens’ pension plans as of June 30, 2011, amounted to approximately €5.4 billion, compared to an underfunding of approximately €5.3 billion at the end of the second quarter. Employer contributions and a positive actual return on plan assets nearly offset an increase in Siemens’ defined benefit obligation (DBO). The DBO rose due to a small decrease in the discount rate assumption as of June 30, 2011 and accrued service and interest costs. As of September 30, 2010, pension plan underfunding amounted to €7.4 billion.

Results of Siemens

Results of Siemens — Three months ended June 30, 2011

     The following discussion presents selected information for Siemens for the third quarter of fiscal 2011:

     Orders and revenue

     Orders climbed to €22.937 billion, up 20% from the third quarter a year earlier, driven by a large contract win for trains in the Industry Sector. Revenue rose 2% to €17.844 billion, including growth in all three reporting regions. Currency translation effects took 5 percentage points from reported growth in both orders and revenue for the quarter. On an organic basis, excluding the net effect of currency translation and portfolio transactions, orders rose 25% and revenue was up 8% compared to the prior-year quarter. The combined book-to-bill ratio for the Sectors and Siemens overall was 1.29. The order backlog climbed to €96 billion as of June 30, 2011.

		New orders (location of customer)
		Three months
		ended June 30,								% Change								therein
(in millions of €)		2011				2010				Actual				Adjusted(1)				Currency				Portfolio
Europe, C.I.S.(2), Africa, Middle East			13,417				10,153				32	%			34	%			(1	)%			(1	)%
therein Germany			6,187				3,109				99	%			99	%			0	%			0	%
Americas			5,330				5,848				(9	)%			1	%			(10	)%			0	%
therein U.S.			3,906				4,190				(7	)%			6	%			(13	)%			0	%
Asia, Australia			4,189				3,178				32	%			39	%			(5	)%			(2	)%
therein China			1,620				1,374				18	%			29	%			(7	)%			(4	)%
therein India			621				505				23	%			31	%			(8	)%			0	%
Siemens			22,937				19,179				20	%			25	%			(5	)%			(1	)%

     Orders related to external customers rose 20% in the third quarter of fiscal 2011, due to order growth of more than 50% in the Industry Sector. Order intake increased in the Industry Sector due to a large order at Mobility for trains in Germany mentioned above and double-digit increases at Drive Technologies and Industry Solutions. Energy orders were slightly lower compared to the prior-year period, including a double-digit increase at Fossil Power Generation which was more than offset by double-digit declines at Renewable Energy and Power Transmission. Orders in Healthcare came in below the prior-year level across its businesses, primarily reflecting strong negative currency translation effects. On a global basis, orders in emerging markets grew 5% compared to the prior-year period and accounted for €6.378 billion or 28% of total orders for the quarter.

     On a geographic basis, the regions Europe, C.I.S., Africa, Middle East and Asia, Australia posted double-digit order growth, partly offset by a decline in the Americas. In the region Europe, C.I.S., Africa, Middle East — our largest reporting region — orders increased 32%, due to strong demand in the Industry Sector, highlighted by the large train order in Germany mentioned above. Orders in Germany climbed 99% overall. Within the region Europe, C.I.S., Africa, Middle East, Energy orders were down 14%, driven by a lower order intake at Renewable Energy and Power Transmission. Healthcare came in 4% lower compared to the prior-year period. The 9% order decline in the Americas was driven by strong negative currency translation effects, primarily from the U.S. On an organic basis, orders increased slightly in the Americas and 6% in the U.S. On a reported basis in the Americas region orders rose in Industry and declined in Energy and Healthcare. The decline was most pronounced in the Energy Sector, where a 20% drop in order intake was due primarily to a lower volume of large orders at Fossil Power Generation in the region. Orders rose 32% in the Asia, Australia region year-over-year, driven by strong order growth in the Energy Sector including double-digit or higher increases at all Divisions. The 23% order increase in India was driven by substantial growth in Industry and at Fossil Power Generation, due in part to large contract wins in the current quarter. The 18% order rise in China was highlighted by a large contract win at Fossil Power Generation.

		Revenue (location of customer)
		Three months
		ended June 30,								% Change								therein
(in millions of €)		2011				2010				Actual				Adjusted(1)				Currency				Portfolio
Europe, C.I.S.(2), Africa, Middle East			9,293				9,165				1	%			3	%			(1	)%			(1	)%
therein Germany			2,554				2,579				(1	)%			0	%			0	%			(1	)%
Americas			5,075				4,978				2	%			14	%			(12	)%			0	%
therein U.S.			3,563				3,518				1	%			15	%			(14	)%			0	%
Asia, Australia			3,475				3,284				6	%			12	%			(5	)%			(1	)%
therein China			1,564				1,483				5	%			13	%			(6	)%			(2	)%
therein India			563				452				25	%			34	%			(10	)%			0	%
Siemens			17,844				17,425				2	%			8	%			(5	)%			(1	)%

     Revenue related to external customers rose 2% compared to the third quarter a year earlier. Revenue in the Industry Sector increased year-over-year, on double-digit increases at Industry Automation and Drive Technologies. Energy revenues were up 5% compared to the prior-year quarter including double-digit increases at Fossil Power Generation and Oil & Gas. Reported revenue in Healthcare came in lower compared to the prior-year period due primarily to strong negative currency translation effects and a significant revenue reduction effect related to particle therapy projects. Revenue in emerging markets globally grew faster than revenue overall, at 8% for the quarter, and accounted for €5.897 billion or 33% of total revenue for the quarter.

     On a geographic basis, revenue increased in all three reporting regions. In the region Europe, C.I.S., Africa, Middle East, third-quarter revenue rose 1% from the prior-year, on a 6% increase in the Industry Sector. Sales in Energy came in 2% higher while Healthcare showed a 13% decline in the region. In the region Americas, revenue grew 2% compared to the prior-year period influenced by strong negative currency translation effects, primarily from the U.S. Increases in third-quarter revenue in Industry and Energy were partly offset by a double-digit decline in the Healthcare Sector in the region. Revenue rose 6% in the Asia, Australia region on increases in all Sectors. While revenue growth in the region was well balanced among most businesses within Industry and Healthcare, development in the Energy Sector was driven by substantially higher revenues at Oil & Gas. Revenue in India increased 25%, including substantially higher sales at Fossil Power Generation and Oil & Gas.

Consolidated Statements of Income

		Three months ended
		June 30,
(in millions of €)		2011				2010				% Change
Gross profit on revenue			5,179				5,300				(2	)%
as percentage of revenue			29.0	%			30.4	%

     Gross profit for the third quarter decreased 2% compared to the same period a year earlier. On the Sector level, gross profit rose in Industry and Energy while Healthcare saw a steep decline in gross profit due largely to the €381 million in negative impacts related to particle therapy projects as mentioned earlier. In the Industry Sector, gross profit was level or higher year-over-year in all five Divisions, with strong increases at Drive Technologies and Industry Automation driven by high capacity utilization. The gross profit increase in Energy was due primarily to a strong operating performance at Fossil Power Generation. In combination, these factors resulted in a gross profit margin of 29.0% for Siemens overall, down from 30.4% in the third quarter a year earlier.

		Three months ended
		June 30,
(in millions of €)		2011				2010				% Change
Research and development expenses			(940	)			(868	)			8	%
as percentage of revenue			5.3	%			5.0	%			—
Marketing, selling and general administrative expenses			(2,581	)			(2,510	)			3	%
as percentage of revenue			14.5	%			14.4	%			—
Other operating income			106				188				(44	)%
Other operating expense			(34	)			(83	)			(59	)%
Income (loss) from investments accounted for using the equity method, net			(43	)			41				—
Interest income			550				513				7	%
Interest expense			(424	)			(436	)			(3	)%
Other financial income (expense), net			(736	)			(110	)			>200	%

     Research and development (R&D) expenses rose to €940 million or 5.3% of revenue, from €868 million or 5.0% of revenue in the prior-year period, on increases in all Sectors. Marketing, selling and general administrative (SG&A) expenses in the third quarter rose to €2.581 billion or 14.5% of revenue, from €2.510 billion or 14.4% of revenue a year earlier, including higher expenses in Industry and Energy associated with business expansion.

     Other operating income was €106 million in the third quarter of fiscal 2011, down from €188 million in the same period a year earlier. For comparison, in the prior-year period Siemens ceased to consolidate a former subsidiary due to a loss of control and recorded a related gain of €40 million. In addition, the third quarter a year earlier included higher gains related to the disposal of real estate. Other operating expense was €34 million in the third quarter, compared to €83 million in the prior-year period. For additional information, see “Notes to Condensed Interim Consolidated Financial Statements” within this Interim Report.

     Income (loss) from investments accounted for using the equity method, net was a negative €43 million in the current quarter, compared to a positive €41 million in the third quarter a year earlier. Within this change, the equity investment loss related to Nokia Siemens Networks B.V. (NSN) increased to €116 million in the current period, up from €81 million in the prior-year quarter. For additional information, see “Notes to Condensed Interim Consolidated Financial Statements” within this Interim Report.

     Interest income increased to €550 million, from €513 million in the same period a year earlier. Interest expense decreased modestly to €424 million, from €436 million in the prior-year quarter, including lower interest costs related to pension plans. For additional information, see “Notes to Condensed Interim Consolidated Financial Statements” within this Interim Report.

     Other financial income (expense), net was a negative €736 million in the third quarter of fiscal 2011, compared to a negative €110 million in the same period a year earlier. The change year-over-year was due primarily to a negative impact of €682 million in Energy related to the arbitration decision as discussed earlier. For additional information, see “Notes to Condensed Interim Consolidated Financial Statements” within this Interim Report.

		Three months ended
		June 30,
(in millions of €)		2011				2010				% Change
Income from continuing operations before income taxes			1,077				2,035				(47	)%
Income taxes			(314	)			(607	)			(48	)%
as percentage of income from continuing operations before income taxes			29	%			30	%			—
Income from continuing operations			763				1,428				(47	)%
Income (loss) from discontinued operations, net of income taxes			(262	)			7				—
Net income			501				1,435				(65	)%
Net income attributable to non-controlling interests			39				24				—
Net income attributable to shareholders of Siemens AG			462				1,411				(67	)%

     Income from continuing operations before income taxes decreased to €1.077 billion in the current quarter, compared to €2.035 billion in the same period a year earlier. The change year-over-year was due to the factors mentioned above, primarily including the negative impact of €682 million in Energy related to the arbitration decision and €381 million in negative impacts related to particle therapy projects in the Healthcare Sector. The effective tax rate was 29% in the third quarter, slightly below 30% in the prior-year period. As a result, income from continuing operations was €763 million in the current period, down from €1.428 billion in the third quarter a year earlier.

     Discontinued operations primarily include Siemens IT Solutions and Services which was sold to Atos S.A. (AtoS) after the close of the third quarter on July 1, 2011, and OSRAM which Siemens plans to list publicly in the fall of the calendar year 2011. In addition, discontinued operations include former Com activities, comprising telecommunications carrier activities transferred into NSN in the third quarter of fiscal 2007; the enterprise networks business, 51% of which was divested during the fourth quarter of fiscal 2008; and the mobile devices business sold to BenQ Corporation in fiscal 2005 as well as the former Siemens VDO Automotive activities, which were sold to Continental AG in the first quarter of fiscal 2008. Income from discontinued operations in the current quarter was a negative €262 million, compared to a positive €7 million in the same period a year earlier. The change year-over-year related mainly to a loss of €305 million after tax in the current period attributable to Siemens IT Solutions and Services, including €309 million in transaction-related pretax charges as well as pretax charges of €41 million related to establishing Siemens IT Solutions and Services as a separate legal group, including for carve-out activities and personnel-related matters. For comparison, the result associated with Siemens IT Solutions and Services in the prior-year period was a loss of €62 million after tax. Income from discontinued operations related to OSRAM was €56 million after tax in the third quarter of fiscal 2011, down from €74 million after tax in the same period a year earlier. On a slight increase in revenue year-over-year, OSRAM’s operating results declined substantially due to a combination of factors, including higher costs for raw materials and pricing pressure. A positive effect from cessation of depreciation and amortization resulting from classifying OSRAM as discontinued operations more than offset expenses for legal matters. For additional information, see “Portfolio activities” and “Notes to Condensed Interim Consolidated Financial Statements” within this Interim Report.

     Net income for Siemens in the third quarter of fiscal 2011 declined to €501 million, compared to €1.435 billion in the same period a year earlier. Net income attributable to shareholders of Siemens AG was €462 million, down from €1.411 billion in the prior-year quarter.

Results of Siemens — Nine months ended June 30, 2011

     The following discussion presents selected information for Siemens for the first nine months of fiscal 2011:

     Orders and revenue

     In the first nine months of fiscal 2011, orders rose 23% year-over-year, to €64.425 billion, including a substantially higher volume from major orders compared to the prior-year nine-month period. Revenue increased to €53.164 billion, up 7% from the prior-year period, due in part to strong conversion of orders from the Sectors’ backlogs. This resulted in a book-to-bill ratio for Siemens of 1.21 for the first nine months. Organic volume development was almost in line with reported figures, as currency exchange fluctuations within the first nine months were largely offsetting.

		New orders (location of customer)
		Nine months
		ended June 30,								% Change								therein
(in millions of €)		2011				2010				Actual				Adjusted(1)				Currency				Portfolio
Europe, C.I.S.(2), Africa, Middle East			36,012				28,787				25	%			25	%			1	%			(1	)%
therein Germany			13,037				7,944				64	%			65	%			0	%			(1	)%
Americas			15,997				14,778				8	%			8	%			0	%			0	%
therein U.S.			11,566				10,545				10	%			11	%			(1	)%			0	%
Asia, Australia			12,416				8,901				39	%			37	%			4	%			(1	)%
therein China			4,749				3,768				26	%			27	%			2	%			(2	)%
therein India			2,617				1,468				78	%			75	%			3	%			0	%
Siemens			64,425				52,466				23	%			22	%			1	%			(1	)%

     Orders related to external customers in the first nine months of fiscal 2011 increased 23% compared to the same period a year earlier, due to higher demand in all Sectors. Order intake in the Energy Sector climbed 23% year-over-year. The higher volume from major orders in the current period mentioned above included a particularly strong increase year-over-year at Fossil Power Generation, which saw a relatively low volume from large orders in the first nine months of fiscal 2010. The Industry Sector reported order growth of 34% on increases in all Divisions. The largest contribution to this increase came from Mobility, which recorded higher volume from large orders compared to the prior-year period including the large order for trains mentioned earlier. Drive Technologies and Industry Automation also contributed strong growth for the Sector. Orders increased for Healthcare compared to the prior-year period on broad-based growth across its businesses. Orders in emerging markets on a global basis grew faster than orders overall, at 28% year-over-year, and accounted for €21.312 billion, or 33%, of total orders for the first nine months of fiscal 2011.

     On a geographic basis, Siemens reported order growth in all three reporting regions in the first nine months of fiscal 2011. In the region Europe, C.I.S., Africa, Middle East, orders rose 25% on double-digit increases in Energy and Industry. The Energy Sector delivered order growth of 16% in the region, due primarily to a substantially higher volume from major orders at Fossil Power Generation compared to the prior-year period. Industry orders rose 46% in the Europe, C.I.S., Africa, Middle East region. The main factor within Industry for the region was the large order for trains mentioned above at Mobility, which drove the 64% order growth in Germany. Order growth for the Sector also included strong demand at Drive Technologies. Healthcare’s nine-month orders in the region came in slightly below the level of the prior-year period. In the Americas region, order intake rose 8% on increases in all Sectors. Industry orders grew 17% in the region, including strong double-digit increases in most Divisions. Higher orders in the Energy Sector were due primarily to higher demand at Fossil Power Generation and Power Transmission. Order intake in the Asia, Australia region climbed 39%, including double-digit growth in all Sectors. Orders in the Energy Sector almost doubled in the first nine months compared to the prior-year period, including substantial increases at Fossil Power Generation and Oil & Gas, both of which took in a higher volume from major orders. Industry reported 17% growth in the region, led by strong demand at Drive Technologies and Industry Automation. Order intake in India increased significantly compared to the prior-year period, due primarily to a major contract win at Fossil Power Generation in the first quarter of fiscal 2011.

		Revenue (location of customer)
		Nine months
		ended June 30,								% Change								therein
(in millions of €)		2011				2010				Actual				Adjusted(1)				Currency				Portfolio
Europe, C.I.S.(2), Africa, Middle East			28,026				27,252				3	%			3	%			1	%			(1	)%
therein Germany			7,847				7,368				6	%			7	%			0	%			(1	)%
Americas			14,962				13,270				13	%			13	%			0	%			0	%
therein U.S.			10,665				9,589				11	%			12	%			(1	)%			0	%
Asia, Australia			10,177				9,052				12	%			10	%			3	%			(1	)%
therein China			4,503				3,846				17	%			17	%			2	%			(1	)%
therein India			1,636				1,290				27	%			26	%			1	%			0	%
Siemens			53,164				49,575				7	%			7	%			1	%			0	%

     Revenue related to external customers rose 7% compared to the first nine months of fiscal 2010, including increases in all Sectors. Strong conversion from the Sectors’ order backlogs played a major role in broad-based revenue growth. Revenue in the Industry Sector increased year-over-year, led by strong double-digit growth at Drive Technologies and Industry Automation. Energy also reported higher revenue in the first nine months of fiscal 2011 on increases in all Divisions, led by Fossil Power Generation and Renewable Energy. Revenue in the Healthcare Sector was slightly above the prior-year period. On a global basis, emerging markets grew faster than revenue overall, at 12%, and accounted for €16.829 billion, or 32%, of total revenue for the first nine months of fiscal 2011.

     On a geographic basis, revenue increased in all three reporting regions, led by double-digit growth in the regions Americas and Asia, Australia. In the region Europe, C.I.S., Africa, Middle East, first nine-month revenue increased 3% year-over-year, including moderate growth in Industry and Energy and a slight decrease in Healthcare. The 6% revenue growth in Germany was driven by double-digit increases at Drive Technologies and Industry Automation. In the Americas region, higher revenue included strong increases in Energy and Industry. Growth in the Energy Sector was driven by strong backlog conversion at Fossil Power Generation and Renewable Energy. Higher revenues in Industry in the region included double-digit increases at Industry Solutions, Drive Technologies and Industry Automation. In the Asia, Australia region, revenue rose 12% on double-digit increases in Industry and Healthcare as well as more moderate growth in the Energy Sector. While revenue development in China followed the pattern for the region overall, growth of 27% in India was driven by significantly higher revenue in Energy.

Consolidated Statements of Income

		Nine months ended
		June 30,
(in millions of €)		2011				2010				% Change
Gross profit on revenue			16,349				14,844				10	%
as percentage of revenue			30.8	%			29.9	%

     Gross profit for the first nine months of fiscal 2011 rose 10% for Siemens overall compared to the same period a year earlier, on double-digit increases in Industry and Energy. All Industry Divisions reported higher gross profits and gross profit margins year-over-year, with the strongest gross profit increases coming from Industry Automation and Drive Technologies driven by high capacity utilization. Fossil Power Generation was the primary driver for the gross profit increase in Energy, including a clear increase in the Division’s gross profit margin due to strong project execution and a favorable business mix in the current nine-month period. Lower gross profit in Healthcare was due primarily to negative impacts related to particle therapy projects, including the impacts mentioned above for the third quarter. For comparison, in fiscal 2010 gross profit in all Sectors benefited from their respective portions of a previously disclosed pension curtailment gain. In combination, these factors resulted in a gross profit margin of 30.8% for Siemens overall, up from 29.9% in the prior-year period.

		Nine months ended
		June 30,
(in millions of €)		2011				2010				% Change
Research and development expenses			(2,771	)			(2,473	)			12	%
as percentage of revenue			5.2	%			5.0	%			—
Marketing, selling and general administrative expenses			(7,498	)			(6,922	)			8	%
as percentage of revenue			14.1	%			14.0	%			—
Other operating income			444				648				(31	)%
Other operating expense			(320	)			(166	)			93	%
Income (loss) from investments accounted for using the equity method, net			172				91				89	%
Interest income			1,641				1,504				9	%
Interest expense			(1,278	)			(1,309	)			(2	)%
Other financial income (expense), net			674				(173	)			—

     R&D expenses in the first nine months of fiscal 2011 increased to €2.771 billion or 5.2% of revenue, from €2.473 billion or 5.0% of revenue in the prior-year period, including higher expenses in all Sectors. SG&A expenses rose to €7.498 billion or 14.1% of revenue, from €6.922 billion or 14.0% of revenue in the prior-year period, due primarily to business growth in Industry and Energy.

     Other operating income in the first nine months was €444 million, down from €648 million in the same period a year earlier. The current period included €64 million related to a settlement of legal and regulatory matters in connection with portfolio activities. For comparison, the prior-year period benefited from a number of positive factors, including a gain of €84 million related to an agreement with the provider of the Siemens’ directors and officers liability insurance, a net gain related to settlements with former members of Siemens’ Managing Board and Supervisory Board, and total gains of €40 million related to the recovery of funds frozen by authorities. In addition, the first nine months of fiscal 2010 included a gain of €47 million related to the sale of Mobility’s airfield solutions business as well as higher gains related to the disposal of real estate. Further, as noted above, Siemens ceased to consolidate a former subsidiary in the third quarter of fiscal 2010 due to a loss of control and recorded a related gain of €40 million. For additional information, see “Notes to Condensed Interim Consolidated Financial Statements” within this Interim Report.

     Other operating expense in the first nine months was €320 million, compared to €166 million in the prior-year period. The current period included higher charges related to legal and regulatory matters. For additional information, see “Notes to Condensed Interim Consolidated Financial Statements” within this Interim Report.

     Income (loss) from investments accounted for using the equity method, net increased to €172 million from €91 million in the prior-year period. The improvement year-over-year includes a gain of €91 million on the sale of our 49% stake in Krauss-Maffei Wegmann GmbH & Co. KG (KMW) in the current period, higher than the equity investment income recorded from our share in KMW in the first nine months a year earlier. Our equity investment loss related to NSN decreased to €204 million in the current nine-month period, from €291 million a year earlier. For additional information, see “Notes to Condensed Interim Consolidated Financial Statements” within this Interim Report.

     Interest income for the first nine months increased to €1.641 billion from €1.504 billion a year earlier. The increase was due in part to a higher expected return on plan assets related to pension plans, resulting primarily from an increase in pension plan assets between the periods under review. In addition, Interest income also rose due to an increase in total liquidity compared to the prior-year period. Interest expense declined to €1.278 billion from €1.309 billion in the prior-year period, driven by lower interest costs related to pension plans.

     Other financial income (expense), net was a positive €674 million in the first nine months of fiscal 2011, compared to a negative €173 million in the same period a year earlier. The change was due primarily to a €1.520 billion gain from the divestment of Siemens’ 34% share in Areva NP S.A.S. to Areva S.A. in the second quarter of the current fiscal year, partly offset by the negative impact of €682 million related to the arbitration decision noted above for the third quarter. For additional information, see “Notes to Condensed Interim Consolidated Financial Statements” within this Interim Report.

		Nine months ended
		June 30,
(in millions of €)		2011				2010				% Change
Income from continuing operations before income taxes			7,413				6,044				23	%
Income taxes			(1,630	)			(1,740	)			(6	)%
as percentage of income from continuing operations before income taxes			22	%			29	%			—
Income from continuing operations			5,783				4,304				34	%
Income (loss) from discontinued operations, net of income taxes			(693	)			160				—
Net income			5,090				4,464				14	%
Net income attributable to non-controlling interests			117				98				—
Net income attributable to shareholders of Siemens AG			4,973				4,366				14	%

     Income from continuing operations before income taxes increased to €7.413 billion in the first nine months of fiscal 2011, compared to €6.044 billion in the same period a year earlier. The change year-over-year is due to the factors mentioned above, primarily including double-digit gross profit increases in Industry and Energy and the net effect related to Areva, partly offset by higher SG&A and R&D expenses associated with business expansion. The effective tax rate was 22% in the first nine months of fiscal 2011, clearly below 29% in the prior-year period. The current nine-month rate benefited from the mainly tax-free Areva disposal gain. Income from continuing operations was €5.783 billion in the first nine months of fiscal 2011, up from €4.304 billion in the prior-year period.

     Discontinued operations primarily include Siemens IT Solutions and Services which was sold to AtoS after the close of the third quarter on July 1, 2011, and OSRAM which Siemens plans to list publicly in the fall of the calendar year 2011. In addition, discontinued operations include former Com activities, comprising telecommunications carrier activities transferred into NSN in the third quarter of fiscal 2007; the enterprise networks business, 51% of which was divested during the fourth quarter of fiscal 2008; and the mobile devices business sold to BenQ Corporation in fiscal 2005 as well as the former Siemens VDO Automotive activities, which were sold to Continental AG in the first quarter of fiscal 2008. Income from discontinued operations in the first nine months of fiscal 2011 was a negative €693 million, compared to a positive €160 million a year earlier. The change year-over-year related mainly to a loss of €820 million after tax in the current nine months attributable to Siemens IT Solutions and Services. This result includes a pretax goodwill impairment of €136 million booked in the first quarter; pretax charges of €464 million for impairments on long-lived assets booked in the second quarter; €309 million in transaction-related pretax charges recorded in the third quarter; and pretax charges of €145 million related to establishing Siemens IT Solutions and Services as a separate legal group, including for carve-out activities and personnel-related matters. For comparison, the result associated with Siemens IT Solutions and Services in the first nine months of fiscal 2010 was a loss of €107 million after tax. OSRAM contributed a positive €255 million after tax to income from discontinued operations, nearly unchanged from a positive €254 million after tax in the prior-year period. For additional information, see “Portfolio activities” and “Notes to Condensed Interim Consolidated Financial Statements” within this Interim Report.

     Net income for Siemens in the first nine months of fiscal 2011 increased to €5.090 billion, compared to €4.464 billion in the same period a year earlier. Net income attributable to shareholders of Siemens AG was €4.973 billion, up from €4.366 billion in the prior-year period.

Portfolio activities

     In November 2010, Siemens closed the acquisition of a non-controlling interest of 49% in A2SEA A/S, a supplier of installation services for the construction of offshore wind farms, reported within the Renewable Energy Division of the Energy Sector.

     In December 2010, Siemens completed the transfer of its 19.8% stake in GIG Holding GmbH (owner of all shares of Gigaset Communications GmbH) to ARQUES Industries AG.

     In December 2010, Siemens and Atos S.A. (AtoS) signed an option agreement which granted AtoS the right to acquire Siemens IT Solutions and Services. In February 2011, AtoS exercised its option to acquire Siemens IT Solutions and Services in exchange for 12.5 million newly issued shares in AtoS with a five-year lock-up commitment, a five-year convertible bond of €250 million (nominal value) and a cash payment of €177 million. Furthermore, Siemens will provide extensive support in order to foster the Siemens IT Solutions and Services’ business success including, among others, up to €250 million to the integration and training costs as well as further protections and guarantees. Related to the transaction is a seven-year outsourcing contract worth around €5.5 billion, under which AtoS will provide managed services and system integration to Siemens. Following signing, Siemens classified Siemens IT Solutions and Services as held for disposal and as discontinued operations. During the second quarter, the transaction was cleared with the antitrust authorities. On July 1, 2011, after the close of the third quarter, the transaction closed following the approval by AtoS shareholders. Siemens expects the transaction to have a substantial negative earnings impact in fiscal 2011, in a high-triple-digit million euro range. In particular this negative earnings impact consists of impairments, including the previously reported goodwill impairment of €136 million booked in the first quarter and further impairments on long-lived assets of €464 million booked in the second quarter, as well as €309 million in transaction-related charges recorded in the third quarter. In addition to these transaction-related results, and as previously disclosed, Siemens took charges in fiscal 2011 related to establishing Siemens IT Solutions and Services as a separate legal group, including for carve-out activities and personnel-related matters. Such charges reported within discontinued operations amounted to €41 million in the current quarter and to €145 million in the first nine months of fiscal 2011. Siemens expects the transaction and activities related to establishing Siemens IT Solutions and Services as a separate legal group will result in further profit impacts as well as substantial cash outflows in coming quarters. See also “Notes to Condensed Interim Consolidated Financial Statements.”

     At the beginning of January 2011 the sale of Siemens’ electronics assembly systems business, reported within Centrally managed portfolio activities, to ASM Pacific Technology Ltd. was closed.

     In January 2011, the sale of the 49% interest in KMW to the Wegmann Group was closed after approval by the antitrust authorities and receipt of the second purchase price installment. The gain on the sale of KMW, which is reported in Equity Investments amounts to €91 million.

     In January 2011, Siemens made a binding offer to purchase additional shares in order to increase its stake in its publicly listed Indian subsidiary Siemens Ltd. from about 55% to a maximum of 75%. Siemens offered the shareholders of Siemens Ltd. to purchase their shares for a price of INR 930 per share (written put). The offer period began on March 25, 2011 and ended on April 13, 2011. The offer was accepted in full until that date and the transaction was completed at the end of April 2011.

     In February 2011, Siemens signed an agreement to acquire a controlling interest of 100% in Siteco Lighting GmbH (Siteco) in a share deal transaction. Siteco is a leading European lighting company that supplies luminaries and lighting systems for urban infrastructures such as public and commercial buildings, streets, tunnels, airports and sports stadiums. The transaction closed at the beginning of July 2011. Siteco will be integrated into OSRAM, which is presented in discontinued operations.

     In March 2011, an independent expert, appointed by Siemens and Areva based on the rules set forth in the shareholders’ agreement, determined the fair market value (purchase price) of Siemens’ 34% share in the joint venture Areva NP at €1.620 billion upon which Siemens received a payment of €1.747 billion from Areva. In addition to the externally determined fair market value, the sale proceeds include other adjusting components based on the shareholders’ agreement and further contractual arrangements between Siemens and Areva, namely interest accretion on the purchase price and a reimbursement of a mandatory capital injection from Areva to Siemens. Following the receipt of the expert opinion and the payment, our shares, previously accounted for as available-for-sale financial asset held for disposal at the Energy Sector, were transferred to Areva and derecognized at Siemens. In May 2011, an arbitral tribunal of the International Chamber of Commerce (ICC) ruled on the modalities of Siemens’ exit from the joint venture Areva NP. According to the tribunal’s ruling, Siemens had to pay Areva liquidated damages of €0.7 billion including interest.

     At the end of March 2011, Siemens announced that it plans to publicly list its subsidiary OSRAM AG (formerly OSRAM GmbH) in fall 2011. Siemens intends to retain a minority stake in the OSRAM AG, in which it intends to remain a long-term anchor shareholder.

     Siemens completed certain other portfolio transactions during the first nine months of fiscal 2011, which did not have a significant effect on our Interim Consolidated Financial Statements. For further information on acquisitions and dispositions, see “Notes to Condensed Interim Consolidated Financial Statements.”

Segment information analysis

Sectors

Industry

Industry — Three months ended June 30, 2011

Sector		Three months
		ended June 30,								% Change								therein
(in millions of €)		2011				2010				Actual				Adjusted(1)				Currency				Portfolio
Profit			872				710				23	%
Profit margin			10.8	%			9.4	%
New orders			11,806				7,657				54	%			58	%			(4	)%			0	%
Revenue			8,082				7,570				7	%			11	%			(4	)%			0	%

     In a robust industrial environment, the Industry Sector increased its third-quarter profit 23%, to €872 million, on strong earnings increases at the Industry Automation and Drive Technologies Divisions. The Sector continued to invest in innovation and enhancing its regional footprint with additional sales resources. Third-quarter revenue rose 7% year-over-year, on double-digit increases at Industry Automation and Drive Technologies. Orders rose 54% compared to the prior-year period, including growth at all Divisions and a €3.7 billion order at Mobility for trains in Germany. On a geographic basis, revenue was up in all three regions. Orders rose in Europe, C.I.S., Africa, Middle East and the Americas, and came in slightly lower year-over-year in Asia, Australia due to negative currency translation effects. For the Sector as a whole, currency translation effects took 4 percentage points from reported growth in both revenue and orders. Industry’s book-to-bill ratio was 1.46 and its order backlog increased to €32 billion at the end of the quarter.

Divisions		New Orders
		Three months
		ended June 30,								% Change								therein
(in millions of €)		2011				2010				Actual				Adjusted(1)				Currency				Portfolio
Industry Automation			1,885				1,783				6	%			7	%			(3	)%			2	%
Drive Technologies			2,101				1,859				13	%			17	%			(4	)%			0	%
Building Technologies			1,910				1,823				5	%			9	%			(5	)%			0	%
Industry Solutions			1,681				1,487				13	%			22	%			(6	)%			(3	)%
Mobility			4,799				1,236				>200	%			>200	%			(4	)%			1	%

Divisions		Revenue
		Three months
		ended June 30,								% Change								therein
(in millions of €)			2011				2010				Actual			Adjusted(1)				Currency				Portfolio
Industry Automation			1,854				1,587				17	%			19	%			(4	)%			2	%
Drive Technologies			2,082				1,815				15	%			18	%			(3	)%			0	%
Building Technologies			1,818				1,738				5	%			9	%			(5	)%			0	%
Industry Solutions			1,476				1,461				1	%			8	%			(4	)%			(3	)%
Mobility			1,481				1,593				(7	)%			(5	)%			(2	)%			1	%

Divisions		Profit												Profit margin
		Three months												Three months
		ended June 30,												ended June 30,
(in millions of €)		2011				2010				% Change				2011				2010
Industry Automation			347				267				30	%			18.7	%			16.8	%
Drive Technologies			292				206				42	%			14.0	%			11.3	%
Building Technologies			74				79				(7	)%			4.1	%			4.6	%
Industry Solutions			77				63				22	%			5.2	%			4.3	%
Mobility			81				95				(14	)%			5.5	%			6.0	%

     Third-quarter profit at Industry Automation was €347 million, up 30% year-over-year. Revenue growth kept capacity utilization at a high level and also included a more favorable business mix compared to the prior-year quarter. Revenue climbed 17% on increases in all business units. On a geographic basis, revenue growth came from Europe, C.I.S., Africa, Middle East and Asia, Australia. Third-quarter orders were up 6% compared to the prior-year period. Purchase price allocation (PPA) effects related to the fiscal 2007 acquisition of UGS Corp. (UGS) were €33 million in the current period compared to €37 million a year earlier.

     Drive Technologies generated profit of €292 million, a 42% increase compared to the third quarter a year earlier. A 15% rise in revenue enabled the Division to increase its capacity utilization still further, and profit development also included a more favorable business mix. All business units in the Division delivered growth in both revenue and orders compared to the prior-year period, led by substantial increases in the Division’s short-cycle businesses. On a geographic basis, orders and revenues showed double-digit growth in all three regions.

     Building Technologies contributed €74 million to Sector profit in the third quarter, below the prior-year level due partially to higher marketing and selling expenses associated with growth. Third-quarter revenue and orders each rose 5% year-over-year, with most business units contributing. On a geographic basis, revenue and order growth were driven by Europe, C.I.S., Africa, Middle East and Asia, Australia.

     Industry Solutions increased its third-quarter profit to €77 million, including higher earnings in the metals technologies business. Third-quarter revenue for Industry Solutions as a whole increased modestly year-over-year. Orders climbed 13% on a higher volume from large orders compared to the prior-year period.

     In the current quarter Mobility took in its largest-ever rolling stock order, for trains in Germany, worth €3.7 billion. Under the terms of the contract, revenue recognition related to the order will extend for a number of years ahead. Third-quarter revenue came in 7% below the level a year earlier, and profit declined to €81 million.

Industry — Nine months ended June 30, 2011

Sector		Nine Months
		ended June 30,								% Change								therein
(in millions of €)		2011				2010				Actual				Adjusted(1)				Currency				Portfolio
Profit			2,577				1,974				30	%
Profit margin			10.9	%			9.1	%
New orders			28,985				21,658				34	%			33	%			1	%			0	%
Revenue			23,728				21,669				10	%			8	%			1	%			0	%

     For the first nine months of fiscal 2011 profit at Industry rose to €2.577 billion, up from €1.974 billion a year earlier. The Industry Automation and Drive Technologies Divisions both posted sharply higher profit on increased capacity utilization as well as an improved business mix and made the largest contribution to Sector profit growth year-over-year. Industry Solutions and Building Technologies also posted higher results while profit at Mobility declined year-over-year. Sector profit for the current nine months was burdened by the Sector’s €128 million share of a special employee remuneration allocation in the first quarter (for further information see “Reconciliation to consolidated financial statements — Corporate items and pensions”). In the same period a year earlier, burdens on profit included charges of €79 million related to a project engagement with a local partner in the U.S., €72 million for staff reduction measures and a provision for a supplier-related warranty. These factors were only partly offset by a gain of €53 million related to curtailment of pension plans in the U.S. and a gain of €47 million on the sale of Mobility’s airfield solutions business.

     Orders in the first nine months climbed 34% compared to the same period a year earlier, on increases in all Divisions and all reporting regions. The largest increase year-over-year came from Mobility, which recorded significantly higher volume from large orders including the €3.7 billion train order in Germany mentioned above. Revenue for the Sector was 10% higher compared to the prior-year period, led by double-digit increases at Industry Automation and Drive Technologies. Revenue rose in all three regions.

Divisions		New orders
		Nine months
		ended June 30,								% Change								therein
(in millions of €)		2011				2010				Actual				Adjusted(1)				Currency				Portfolio
Industry Automation			5,603				4,698				19	%			17	%			1	%			1	%
Drive Technologies			6,817				5,246				30	%			28	%			2	%			0	%
Building Technologies			5,603				5,111				10	%			8	%			1	%			0	%
Industry Solutions			4,539				4,148				9	%			12	%			0	%			(2	)%
Mobility			8,581				4,264				101	%			99	%			2	%			0	%

Divisions		Revenue
		Nine months
		ended June 30,								% Change								therein
(in millions of €)		2011				2010				Actual				Adjusted(1)				Currency				Portfolio
Industry Automation			5,403				4,410				23	%			19	%			1	%			2	%
Drive Technologies			5,887				4,946				19	%			18	%			1	%			0	%
Building Technologies			5,382				4,954				9	%			7	%			1	%			0	%
Industry Solutions			4,269				4,381				(3	)%			(1	)%			1	%			(3	)%
Mobility			4,618				4,751				(3	)%			(4	)%			1	%			0	%

Divisions		Profit												Profit margin
		Nine months												Nine months ended
		ended June 30,												June 30,
(in millions of €)		2011				2010				% Change				2011				2010
Industry Automation			1,016				681				49	%			18.8	%			15.4	%
Drive Technologies			780				534				46	%			13.3	%			10.8	%
Building Technologies			274				267				3	%			5.1	%			5.4	%
Industry Solutions			189				121				56	%			4.4	%			2.8	%
Mobility			304				361				(16	)%			6.6	%			7.6	%

     In the first nine month of fiscal 2011, Industry Automation recorded profit of €1.016 billion, up 49% year-over-year on higher capacity utilization and an improved business mix. Revenue climbed 23% and orders rose 19% year-over-year on increases in all businesses as well as double-digit growth in all three regions. Growth rates in emerging markets exceeded growth rates for volume overall. PPA effects related to the acquisition of UGS were €103 million for the first nine months, level with the prior-year period.

     In the first nine months of fiscal 2011, orders at Drive Technologies were up 30%, including higher volume from large orders. Revenue grew by 19% year-over-year. While all businesses contributed to the increase, volume growth was particularly strong in the Division’s short-cycle businesses. Higher capacity utilization together with an improved business mix led to sharply higher profit of €780 million in the current nine-month period.

     Profit of €274 million at Building Technologies came in slightly above the prior-year level. While profit development in the current period was held back by higher marketing and selling expenses associated with growth, profit in the prior-year period was impacted by a charge for the supplier-related warranty mentioned above, largely offset by the Division’s €24 million portion of the pension curtailment gain mentioned above for the Sector. Revenue for the current nine months was up 9% compared to the prior-year period and orders grew 10% year over year. Volume development benefited from strong demand for energy efficiency solutions. On a geographic basis, orders and revenue grew in all regions with particular strength in Asia, Australia.

     In the first nine months, Industry Solutions increased orders by 9% year-over-year on higher demand at the metals technologies business including strong growth in the Americas. Revenue came in 3% below the prior-year level as double-digit growth in the Americas was more than offset by declining revenue in the region comprising Europe, C.I.S., Africa, Middle East. Profit for the current nine months for Industry Solutions was €189 million, compared to €121 million in the same period a year earlier when the Division took the above-mentioned €79 million in charges related to a project engagement with a local partner in the U.S. and €39 million in charges for staff reduction measures.

     New orders at Mobility doubled year-over-year, on substantially higher volume from large orders, including the largest-ever order for trains in Germany mentioned above as well as a major order for high-speed trains in the U.K. Revenue for the first nine months was down 3%. Profit in the current period was €304 million compared to €361 million in the same period a year earlier, which benefited from the €47 million net gain on the sale of the airfield solutions business and from a portion of the pension curtailment gain mentioned above.

Energy — Three months ended June 30, 2011

Sector		Three months ended
		June 30,								% Change								therein
(in millions of €)		2011				2010				Actual				Adjusted(1)				Currency				Portfolio
Profit			263				875				(70	)%
Profit margin			3.9	%			13.5	%
New orders			8,027				8,061				0	%			4	%			(4	)%			0	%
Revenue			6,776				6,462				5	%			10	%			(5	)%			0	%

     Energy delivered another impressive quarter on an operating basis, and absorbed the €682 million profit impact related to the arbitration decision discussed earlier. The Fossil Power Generation Division continued its outstanding project execution and earnings performance of recent quarters, which more than offset higher expenses in other Divisions for R&D, marketing and selling associated with strategic business expansion. Taken together, these factors resulted in reported Sector profit of €263 million in the third quarter, compared to €875 million in the same period a year earlier.

     The slower pace of order intake expected for the second half of the fiscal year was evident in the third quarter, as orders came in slightly lower compared to the prior year. Within the total, strong demand in Asia, Australia nearly offset decreases in Europe, C.I.S., Africa, Middle East and the Americas. In contrast, revenue came in 5% higher, including double-digit increases at Fossil Power Generation and Oil & Gas and increases in all regions. Negative currency translation effects took 5 percentage points from reported revenue growth and 4 percentage points from reported order growth in the quarter. The book-to-bill ratio was 1.18, and Energy’s order backlog was €57 billion at the end of the third quarter.

Divisions		New orders
		Three months ended
		June 30,								% Change								therein
(in millions of €)		2011				2010				Actual				Adjusted(1)				Currency				Portfolio
Fossil Power Generation			3,016				2,097				44	%			51	%			(7	)%			0	%
Renewable Energy			1,543				2,271				(32	)%			(29	)%			(3	)%			0	%
Oil & Gas			1,321				1,268				4	%			4	%			(1	)%			1	%
Power Transmission			1,453				1,787				(19	)%			(14	)%			(4	)%			0	%
Power Distribution			883				768				15	%			21	%			(6	)%			0	%

Divisions		Revenue
		Three months ended
		June 30,								% Change								therein
(in millions of €)		2011				2010				Actual				Adjusted(1)				Currency				Portfolio
Fossil Power Generation			2,595				2,348				11	%			16	%			(5	)%			0	%
Renewable Energy			975				953				2	%			13	%			(10	)%			0	%
Oil & Gas			1,178				998				18	%			19	%			(3	)%			1	%
Power Transmission			1,463				1,582				(7	)%			(3	)%			(4	)%			0	%
Power Distribution			742				734				1	%			5	%			(4	)%			0	%

Divisions		Profit												Profit margin
		Three months ended												Three months ended
		June 30,												June 30,
(in millions of €)		2011				2010				%Change				2011				2010
Fossil Power Generation			(97	)			362				—				(3.7	)%			15.4	%
Renewable Energy			68				122				(45	)%			7.0	%			12.8	%
Oil & Gas			104				100				4	%			8.8	%			10.0	%
Power Transmission			132				193				(31	)%			9.1	%			12.2	%
Power Distribution			52				96				(46	)%			7.0	%			13.0	%

     Fossil Power Generation maintained its operating performance and earnings capacity at the outstanding level of the previous two quarters. The Division combined excellent project performance with a favorable business mix, including conversion of high-margin component orders from its backlog and an increased contribution from its service business. As noted earlier, the Division’s third-quarter profit was reduced by the €682 million impact related to the arbitration decision. As a result, Fossil Power Generation reported a loss of €97 million in the third quarter. Revenue rose 11% compared to the same period a year earlier, with the largest increase on a geographic basis in the region Europe, C.I.S., Africa, Middle East. With a higher volume from major orders, the Division’s order intake climbed 44% from the low basis of comparison in the third quarter a year earlier.

     Renewable Energy continued the expansion of its wind business, posting significantly increased third-quarter expenses primarily for marketing and selling. Combined with increased pricing pressure in a maturing and more competitive market for wind power, particularly for onshore projects, this reduced third-quarter profit to €68 million from the prior-year level. The business environment remains challenging for the solar business, which continued to post negative results. The Division’s revenue continued to rise year-over-year on conversion of orders from its large backlog. New orders totaled €1.543 billion, yet came in below the prior-year quarter which included an exceptionally high volume from major orders.

     Profit at Oil & Gas increased to €104 million in the third quarter, driven by a strong performance in the turbines business. Growth in Asia, Australia, particularly including emerging markets, took revenue and orders up 18% and 4%, respectively, compared to the same period a year earlier.

     Third-quarter profit at Power Transmission was €132 million, below the prior-year period which benefited from positive effects related to project performance. Profit in the current quarter was held back by lower revenue, conversion of lower-margin contracts from the backlog, and further charges related to optimizing the Division’s global manufacturing footprint. Third-quarter orders came in 19% lower compared to the prior-year quarter, which included two large orders for grid access to off-shore wind farms.

     Power Distribution again posted higher quarterly expenses year-over-year for marketing, selling and R&D, for business expansion, along with continuing expenses related to new technologies such as smart grids. This had a significant impact on profit, which came in lower year-over-year, at €52 million. Revenue rose 1% from the same period a year earlier, and orders climbed 15% on double-digit growth in the Americas and Asia, Australia.

Energy — Nine months ended June 30, 2011

Sector		Nine months ended
		June 30,								% Change								therein
(in millions of €)		2011				2010				Actual				Adjusted(1)				Currency				Portfolio
Profit			3,510				2,458				43	%
Profit margin			17.7	%			13.5	%
New orders			25,990				21,061				23	%			22	%			1	%			0	%
Revenue			19,862				18,260				9	%			8	%			1	%			0	%