Siemens has posted better-than-expected adjusted operating profit from its industrial business during its second quarter as the German industrial giant began separating and spinning off its struggling power and gas business.
The trains to industrial turbines maker said its industrial profit rose 7% to €2.4 billion in the three months to the end of March, beating estimates of €2.24 billion in an Infront data poll.
Revenue rose 4% to €20.94 billion, matching estimates, while orders rose 6% to €23.61 billion.
The company confirmed its outlook for its 2019 fiscal year, saying it expected a profit margin of 11-12% for its industrial business and a basic earnings per share from net income of €6.30-7.
"We delivered on our promises again this quarter, and even exceeded expectations in many areas," Siemens chief executive Joe Kaeser said.
"Now we enter into a new era to become an even stronger and more focused Siemens," he added.
Earlier this week Siemens said it would spin off its gas and power business, which has dragged on the engineering firm's performance as the rise of renewable power hits demand for gas turbines.
Siemens is leaving behind the business where revenues and profit have collapsed due to plummeting demand and cut-throat competition from rivals including Mitsubishi Heavy Industries and General Electric.
During the first three months of the year revenue at the division fell 4%, although the adjusted operating profit recovered due to a strong contribution from services.
In future Siemens will concentrate its energies on its Digital Industries business, which automates factories with drives and software.
Siemens Digital Factory unit, which will be the basis for the new division, struggled during the quarter with weaker demand for automation products and weaker investment sentiment in China.
Although revenue rose by 4%, operating profits fell.
Building technologies, which will be the basis for Siemens Smart Infrastructure - the other half of the company's new focus - saw its orders and revenue rise during the quarter.
With the reorganisation Siemens wants to raise the profit margin for its industrial business to 14-18%, from the current goal of 11-15%.
