Siemens Healthineers posts 20% rise in third-quarter profit, despite "challenges" in diagnostics business

Headline results for the third quarter:

Revenue

€3.6 billion ($4 billion)

+8%

Profit

€353 million ($393 million; forecasts of €328 million)

+20%

Note: All changes are versus the prior-year period unless otherwise stated

What the company said:

CEO Bernd Montag noted "we are facing challenges in the diagnostics business," adding "we are tackling these issues resolutely." The executive said it would probably take longer for the company to reach its targets for the diagnostics business, as it would be difficult to deliver 7000 Atellica Solution machines by the end of next fiscal year. The company expects to ship about 1800 Atellica machines this year, down from a previous estimate of 2200 to 2500, while upgrades to the system have led to higher costs in the third quarter.

Montag remarked "based on the sustained strong volume development and the operative strength of our company, we are confirming our outlook for fiscal year 2019."

Other results:

  • Imaging segment sales: €2.2 billion ($2.4 billion), +11%, with "very strong growth," particularly in computed tomography and in molecular imaging
  • Diagnostics segment sales: €1 billion ($1.1 billion), +4%, as weaker performance in the Americas was offset by the "very strong growth" in the Asia, Australia region and solid performance in the EMEA region
  • Advanced therapies segment sales: €378 million ($421 million), +7%, with "significant" growth in the Asia, Australia region

Looking ahead:

Siemens Healthineers confirmed its outlook for fiscal year 2019, with comparable revenue growth to be in the range of 4% to 5% year-on-year, while earnings per share are still expected to be 20% to 30% above the level of fiscal 2018.

Separately on Monday, Siemens Healthineers announced that Michael Reitermann, who currently heads the firm's diagnostics business, will step down from his role as of September 30 and leave the company "on the basis of an amicable agreement." Following Reitermann's departure, CEO Bernd Montag will assume responsibility for the diagnostics unit.

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