Siemens Q1 2009 earnings release

Strong Performance in Challenging Markets Revenue and Income Rise Book-to-Bill Robust Financial highlights: Peter Löscher, President and Chief Executive Officer of Siemens AG • Orders of €22.220 billion came in 8% below the record high level of the prior-year quarter. The order backlog included no major cancellations. “Siemens got off to a good start in fiscal • Revenue rose 7% to €19.634 billion, supported by 2009, including better strong order growth in recent years. order development than most of our • Total Sectors profit climbed 20%, to €2.005 billion, competitors in the first led by broad-based profit growth in Energy. quarter,” commented Siemens CEO Peter • Income from continuing operations rose 17%, to Löscher. “Revenue increased strongly, and €1.260 billion, on higher Total Sectors profit. we have a robust book-to-bill above one. Total Sectors profit clearly exceeded the • Net income was €1.230 billion in the first quarter. prior-year level. Therefore we are sticking A year earlier, net income of €6.475 billion for the quarter included approximately €5.4 billion in in- to our 2009 targets, even though reaching come from discontinued operations related to them has become more ambitious. While Siemens VDO Automotive. we are closely monitoring market conditions on a quarterly basis, we are progress- • Free cash flow was a negative €1.574 billion coming through the year strong, confident and pared to a negative €217 million in the prior-year focused.” period. The current period includes payments totaling €1.230 billion associated with legal proceedings, SG&A reduction and transformation programs initiated in fiscal 2008. Table of contents Siemens 2-4 Sectors, Equity Investments, Media Relations: Wolfram Trost Cross-Sector Businesses 5-11 Phone: +49 89 636-34794 E-mail: wolfram.trost@siemens.com Other operating and corporate activities 12 Siemens AG, 80200 Munich, Germany Subsequent Events and Outlook 13 Note and Disclaimer 14 Earnings Release Q1 2009 (October 1 to December 31, 2008) Munich, January 27, 2009

Siemens 2 Orders and Revenue Revenue rises and book-to-bill Revenue increases in Broad-based order decline takes in remains well above 1 all Sectors and regions all regions, most Divisions First-quarter revenue rose to Revenue rose in all three Sectors, led In an environment of slowing global €19.634 billion, a 7% increase com- by double-digit growth throughout growth and a worldwide financial pared to the same period a year the Energy Sector. The Healthcare crisis, weaker demand was notice- earlier. Revenue growth was sup- Sector also posted double-digit able throughout Siemens’ business. ported strongly by high order growth including new volume from Orders climbed 3% in Healthcare but growth in the past two fiscal years. the acquisition of Dade Behring declined in Industry and Energy Orders exceeded revenue, at Holdings Inc. (Dade Behring) at the where a majority of Divisions had €22.220 billion but declined 8% Diagnostics Division. lower or level orders year-over-year. compared to the record high first quarter a year earlier. The book-to- On a geographic basis, revenue rose All regions posted lower orders. bill ratio for the current period was in all three reporting regions of Within the Asia/Australia region vol- 1.13. Siemens, with particular strength in ume declined significantly in China, the Americas and Asia, Australia. The where the Industry Solutions Divi- The net effect of currency transla- Fossil Power Generation and Renew- sion and Power Transmission Divi- tion was neutral for revenues and able Energy Divisions led revenue sion had large orders in the prior- orders. On an organic basis, exclud- higher in the Americas, while in year period. Orders came in lower in ing currency effects and portfolio Asia, Australia the largest revenue the Americas due primarily to the transactions, revenue rose 8% and increases came at the Power Trans- Renewable Energy and Oil & Gas orders came in 7% lower compared mission and Industrial Solutions Divisions, which benefited from to the prior-year quarter. Divisions. surging demand in the U.S. a year earlier. Orders rose 12% in Germany on the strength of a large order at the Mobility Division. New Orders & Revenue Book-to-bill % Change Q1 Q1 1.32 1.29 1.23 1.13 1.03 Actual Adjusted* 2008 2009 New Orders 24,242 22,220 (8)% (7)% 24,242 18,400 23,371 18,094 23,677 19,182 22,205 21,651 22,220 19,634 Revenue 18,400 19,634 7% 8% Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Figures in millions of € Figures in millions of € New Orders Revenue Book-to-bill ratio * Excluding currency translation and portfolio effects New Orders & Revenue by Region New Orders & Revenue by Sectors (11)% (6)% (4)% (11)% (6)% 3% New Orders New Orders (2)% 14% (15)% (10)% (16)% (27)% 1% (6)% 12% (10)% (2)% (15)% (19)% (8)% 1,445 1,176 11,0019,831 9,079 8,534 2,806 2,896 13,87113,076 3,505 3,930 6,102 5,498 4,362 4,258 4,269 3,646 638 585 Europe, therein: therein: Asia, therein: therein: Industry Energy Healthcare Americas C.I.S.*, Africa, Germany U.S. Australia China India Sector Sector Sector Middle East 1% 25% 3% 2% 24% 11% Revenue Revenue 6% 2% 9% 6% 9% 2% 4% 2% 0% 15% 16% 11% 10% (5)% 1,095 1,200 9,174 9,351 5,035 6,232 2,653 2,936 10,88611,089 3,155 3,165 4,663 5,370 3,511 4,063 2,851 3,175 380 361 Figures in millions of € Figures in millions of € Q1 2008 Q1 2009 Actual change * Commonwealth of Independent States Q1 2008 Q1 2009 Actual change Adjusted change (throughout excluding currency translation and portfolio effects) Adjusted change

Siemens 3 Income and Profit Businesses and Siemens Real Estate Total Sectors profit climbs led Income from continuing operations (SRE), as well as negative results of by Energy and Healthcare climbs on higher Sectors profit hedging activities not qualifying for Total Sectors profit for the first quar- Income from continuing operations hedge accounting. ter climbed 20% year-over-year, to grew to €1.260 billion, up 17% €2.005 billion. Energy was the pri- compared to the first quarter a year Clean quarter for net income mary driver of Sectors profit growth, earlier. Basic EPS on a continuing with a strong profit rebound in the Net income in the first quarter was basis rose to €1.43 from €1.14 in fossil power business compared to €1.230 billion, with a corresponding the prior-year period. The major the first quarter a year earlier and EPS of €1.40. A year earlier, net in- factor in these increases was higher double-digit profit increases at all come of €6.475 billion and EPS of Total Sectors profit year-over-year. other Divisions. Higher revenue hel- €7.04 benefited substantially from Other positive factors were lower ped lift Sector profit at Healthcare as approximately €5.4 billion in income expenses for Corporate items includ- well. Industry made the largest con- from discontinued operations, pri- ing legal and regulatory matters, tribution to Total Sectors profit in marily related to the sale of Siemens higher income from Equity Invest- the first quarter, but saw a decline VDO Automotive (SV). ments, and continued progress in compared to the prior-year period closing out Other Operations. These due primarily to a sharp decline in positive factors more than offset the industrial automation business. lower income from Cross-Sector Total Sectors Profit Earnings per Share (EPS)* 2,005 7.04 1,673 342 20% 332 756 1.43 1.40 1.14 347 994 907 Income from Net income continuing Q1 2008 Q1 2009 operations Figures in millions of € Figures in millions of € Sectors: Industry Energy Healthcare Q1 2008 Q1 2009 % Change * Basic Income 5,397 17% (81)% n/a 1,260 1,230 1,078 (30) 6,475 Income from continuing Income from discontinued Net income operations operations Figures in millions of € Q1 2008 Q1 2009 % Change

Siemens 4 Cash, Return on Capital Employed (ROCE), Pension Funding Status and Investigation Expenses Pension underfunding Free cash flow impacted ROCE rises on higher income increases on higher DBO by compliance payments On a continuing basis, return on capital employed (ROCE) increased The estimated underfunding of Sie- Free cash flow from continuing op- to 12.9% from 11.6% in the first mens' principal pension plans as of erations was a negative €1.574 bil- quarter a year earlier on higher in- December 31, 2008 amounted to lion compared to a negative €217 come from continuing operations in approximately €4.3 billion, com- million in the first quarter a year the current period. pared to an underfunding of ap- ago. The current quarter includes proximately €2.5 billion at the end substantial increases in net working Compliance expenses fall again as of fiscal 2008. The decline in fund- capital in the Sectors and centrally major legal proceedings conclude ing status is due primarily to a sig- taken cash outflows totaling €1.008 nificant decrease in the discount rate billion related to resolution of legal Siemens concluded the legal pro- assumption at December 31, 2008, proceedings in the U.S. and Ger- ceedings mentioned above during which increased Siemens’ estimated many. Cash outflows for previously the first quarter. Expenses within defined benefit obligation (DBO). recorded charges related to project continuing and discontinued opera- reviews, restructuring, and SG&A tions for outside advisors in connec- reduction totaled €222 million. tion with these matters totaled €50 million, well down from €127 million in the prior-year period and €89 million in the previous quarter. Cash conversion* Free cash flow (1,574) (77) (801) (1,651) (217) (0.20) (584) <(200)% 87% (106)% (1.25) Continuing operations Discontinued operations Con. and discon. operations Figures in millions of € Q1 2008 Q1 2009 Q1 2008 Q1 2009 % Change * continuing operations ROCE* Pension funding status Sept. 30, 2008 Dec. 31, 2008 (2.5) (4.3) 11.6% 12.9% Figures in millions of € Figures in billion of € Q1 2008 Q1 2009 * continuing operations

Sectors 5 Industry Sector Market conditions hold back Profitability below peak Sector profit development but within target range Industry Industry led all Sectors with profit of Industry Automation produced €907 million in the first quarter. For €255 million in profit in the first comparison, Sector profit was €994 quarter and its profit margin re- million in the first quarter a year mained in its target range. Neverthe- earlier. The primary factor in the less income declined year-over-year, difference year-over-year was the with lower profits and margins in Industry Automation Division, which nearly all business units. For com- remained the top income contribu- parison, income in the prior-year tor in the Sector but saw profitability period benefited from a €36 million drop from a peak profit margin in gain on the sale of a business. Pur- the prior-year quarter due to lower chase price accounting (PPA) effects volume and a less favorable product in the current quarter, associated mix. Osram’s contribution to Sector with the acquisition of UGS Corp., profit fell also, as its markets became were €35 million and trimmed ap- more challenging. The other four proximately 180 basis points from Divisions within Industry all in- the Division’s profit margin. In the creased their profit, including dou- same quarter a year earlier, PPA ble-digit increases at Building Tech- effects of €48 million and integra- nologies, Industry Solutions and tion costs of €5 million related to Mobility. UGS took approximately 250 basis points from the profit margin. Reve- First-quarter revenue for Industry nue of €1.977 billion was 5% lower rose 2% compared to the prior-year than in the prior-year quarter and period, while orders came in 11% orders came in 14% lower year-over- lower. On an organic basis, exclud- year, as customers delayed restock- ing currency translation and portfo- ing in the face of uncertain down- lio effects, revenue rose 1% and stream demand. orders declined 11% year-over-year. All Divisions except Industry Auto- Rising revenue lifts profit mation and Osram increased their Drive Technologies produced profit revenues compared to the prior-year of €233 million and 8% revenue period. Revenue growth was strong- growth from a large order backlog est in the Asia, Australia region. benefiting in part from the high- Orders showed exposure to global growth wind power business. The macroeconomic conditions, with Division recorded PPA effects of €9 declines in all regions. The Industry million in the current quarter and Sector’s book-to-bill ratio was 1.05 €10 million in the prior-year period. compared to 1.2 in the prior-year Orders declined mainly on slowing period. demand in short-cycle businesses, most notably the electronics assem- bly unit which posted a loss of €27 million on lower business volume. New Orders & Revenue Sector Profit Sector Profit margin Sector 1.20 1.05 9-13% (11)% 1% (11)% 2% (9)% 11,001 9,174 9,831 9,351 994 907 10.8% 9.7% Q1 2008 Q1 2009 Figures in millions of € Figures in millions of € New Orders Revenue Book-to-bill Q1 2008 Q1 2009 Actual change Q1 2008 Q1 2009 Margin range Actual change vs. previous year Adjusted change vs. previous year

Sectors 6 Better business mix Revenue and profit lower Metals technologies business benefits profitability in weakening markets again drives performance Industry Building Technologies raised its Profit at Osram decreased to €92 All business units in Industry Solu- first-quarter profit to €124 million million despite positive effects from tions contributed to the increase in benefiting from a significant im- hedging activities not qualifying for first-quarter profit. The Division’s provement in its business mix be- hedge accounting. Profitability was large metals technologies unit led tween the periods under review. influenced by lower capacity utiliza- first-quarter revenue and profit- Orders were level year-over-year tion, as revenue fell 8% including growth, continuing to convert its despite a general slowdown in continued weakness in the automo- substantial backlog into current commercial construction, tive market. Osram expects charges business. Orders came in lower particularly in the U.S. in coming quarters related to im- compared to the record level of the proving its cost structure and prior-year quarter. product mix. Project execution on track Mobility delivered profit of €85 million in the first quarter, benefit- Profit by Division ing from a €10 million positive effect related to settlement of a claim in 415 the rolling stock business. For com- 33% (27)% 31% 93% 255 233 225 parison, profit of €44 million in the 126 124 119 prior-year period was burdened by 93 92 91 85 44 (39)% 4% €32 million in charges related to Combino. Orders rose 8% in the Industry Drive Building Osram Industry Mobility quarter, including a major contract Automation Technologies Technologies Solutions win in Germany. Figures in millions of € Q1 2008 Q1 2009 Actual change Profit margin by Division 12-17% 11-16% 7-10% 10-12% 5-7% 5-7% 19.9% 12.9% 11.4% 11.0% 10.6% 8.4% 6.5% 8.1% 5.3% 6.6% 3.1% 5.4% Industry Drive Building Osram Industry Mobility Automation Technologies Technologies Solutions Q1 2008 Q1 2009 Margin ranges New Orders: Weight of Divisions* New Orders & Revenue by Division Industry Automation Drive 19% Technologies 20% New Orders Mobility 18% (13)% (16)% (3)% (7)% (24)% 9% 15% Building 18% 10% (14)% (15)% 0% (8)% (25)% 8% Technologies Industry 2,281 1,953 2,505 2,141 1,539 1,545 1,193 1,097 2,567 1,916 1,775 1,924 Solutions Osram Industry Drive Building Industry Revenue: Weight of Divisions* Osram Mobility Automation Technologies Technologies Solutions Industry Automation 20% Drive 21% Technologies Revenue 15% Mobility (4)% 6% 3% (7)% 3% 11% (5)% 8% 7% (8)% 5% 9% 15% 18% Building 11% Industry 2,089 1,977 1,974 2,123 1,434 1,531 1,193 1,097 1,708 1,796 1,440 1,564 Technologies Solutions Osram Figures in millions of € • • * unconsolidated basis Q1 2008 Q1 2009 Actual change Adjusted change

Sectors 7 Energy Sector Conversion of order backlog The Sector’s book-to-bill ratio was drives profit increases strong at 1.37, though well down Energy The Energy Sector turned in a from 1.8 in the prior-year quarter. strong first quarter, with all Divisions delivering higher profits compared Clean quarter, profitable growth to the prior-year period as well as Fossil Power Generation led all profit margins within their target Siemens Divisions with €289 million ranges. This sent Sector profit up to in profit and brought its profit mar- €756 million for the quarter, well gin into its target range. A year ear- above the prior-year period. Fossil lier, first-quarter profit was bur- Power Generation drove Sector dened by the substantial charges profit growth year-over-year, as its mentioned above. Revenue climbed prior-year results were burdened by 25%, reflecting strong order growth more than €200 million in charges. in recent years. Orders continued to Strong order backlogs at Renewable grow at a robust rate, rising 16% to Energy and Oil & Gas enabled both €3.997 billion including the growth Divisions to raise revenue, increase in Asia, Australia mentioned above. capacity utilization and significantly The Division expects substantial improve their profit margins. Power volatility in equity investment in- Transmission and Power Distribution come in coming quarters. continued to compete successfully in increasingly challenging markets for Continued ramp-up power infrastructure. drives profit higher Renewable Energy generated €101 First-quarter revenue for Energy rose million in profit on revenue of €713 24% year-over-year, to €6.232 bil- million in the first quarter. Both fig- lion, as all Divisions converted a high ures represent high double-digit level of prior orders into current increases compared to the first quar- business. The Sector saw no material ter a year ago, as the Division order cancellations in its backlog matched new production capacity to during the quarter. As expected, a robust order backlog. As expected, orders declined 6% due primarily to orders in the quarter came in lower the Renewable Energy and Oil & Gas compared to the prior-year period, Divisions. While Renewable Energy which included a higher level of took in a lower level of large orders large orders. compared to the prior-year quarter, market conditions for Oil & Gas cooled compared to surging demand in the prior-year period. On a geographic basis, revenue rose in all regions led by the Americas, while orders grew in the Asia, Australia region on particular strength at Fossil Power Generation. Profit Sector New Orders & Revenue Sector Profit margin Sector 1.80 1.37 11-15% (6)% 25% (6)% 24% 118% 9,079 5,035 8,534 6,232 347 756 6.9% 12.1% Q1 2008 Q1 2009 Figures in millions of € Figures in millions of € Q1 2008 Q1 2009 Actual change New Orders Revenue Book-to-bill Q1 2008 Q1 2009 Margin range Actual change vs. previous year Adjusted change vs. previous year

Sectors 8 as expected, but the Division’s book- Strong increase in profitability Power Transmission posted profit to-bill ratio for the quarter was well The Oil & Gas Division contributed of €152 million in the first quarter, above 1 and its order backlog re- Energy €106 million to first-quarter Sector up 22% compared to the prior-year mained robust. profit and brought its profit margin period, on a 21% increase in reve- into the target range. Revenue rose nue. First-quarter orders for the Divi- 27% year-over-year on conversion of Delivering sustained profit growth sion were nearly unchanged year- The Energy Sector’s two power grid the Division’s strong order backlog. over-year. Power Distribution in- infrastructure businesses continued Orders in the current period came in creased first-quarter profit even to deliver steady profit growth in lower than in the prior-year period, more sharply, to €107 million, as all their profit margin ranges. business units improved profitability compared to the same period a year earlier. Revenue rose 10% year-over- year, while orders came in 7% lower. Profit by Division 22% >200% 94% 61% 37% 25 289 52 101 66 106 125 152 78 107 Fossil Power Renewable Oil & Gas Power Power Generation Energy Transmission Distribution Figures in millions of € Q1 2008 Q1 2009 Actual change Profit margin by Division 11-15% 12-16% 10-14% 10-14% 11-15% 1.3% 12.2% 12.5% 14.2% 8.0% 10.1% 10.0% 10.1% 10.7% 13.3% Fossil Power Renewable Oil & Gas Power Power Generation Energy Transmission Distribution Q1 2008 Q1 2009 Margin ranges New Orders & Revenue by Division New Orders: Weight of Divisions* Fossil Power Generation Power 45% Distribution 10% New Orders 14% (38)% (24)% 1% (6)% 7% 22% Power 16% (37)% (26)% 0% (7)% 16% Renewable Transmission Energy 3,431 3,997 1,032 648 1,847 1,360 1,924 1,915 920 857 Oil & Gas Fossil Power Renewable Power Power Oil & Gas Generation Energy Transmission Distribution Revenue: Weight of Divisions* Fossil Power Generation 37% Power Distribution 13% Revenue 23% 71% 32% 21% 12% 11% Renewable 25% 71% 27% 21% 10% Energy 23% 16% Power 1,901 2,373 417 713 827 1,048 1,244 1,500 732 805 Oil & Gas Transmission Figures in millions of € • • Q1 2008 Q1 2009 Actual change Adjusted change * unconsolidated basis

Sectors 9 Healthcare Sector Solid revenue and profit growth Profit margin expansion in in tough market conditions a challenging environment Healthcare The Healthcare Sector continued to Imaging & IT increased first-quarter compete successfully in a challeng- profit 13% year-over-year, to €262 ing environment, as slower growth million. The overall medical imaging and tighter credit conditions spread market in the U.S. remains challeng- beyond the U.S. to other regions. ing, with demand limited by tight First-quarter Sector profit increased credit and the Deficit Reduction Act to €342 million and the Imaging & IT (DRA). Nevertheless, Imaging & IT Division was one of Siemens’ top achieved a 7% rise in revenue and a profit contributors in the quarter. 1% increase in orders. On an organic Charges related to a major project at basis, revenue was up 4% and orders Workflow & Solutions held back were 2% below the level of the prior- profit growth year-over-year. The year period. Diagnostics Division recorded a total of €66 million in PPA effects and Solid performance and integration costs associated with lower integration costs acquisitions, including Dade Behring. Diagnostics contributed €83 million PPA effects and integration costs to Sector profit in the first quarter, reduced Sector profit margin by 220 up from €67 million in the same basis points in the first quarter, quarter a year earlier. For compari- compared to 320 basis points in the son, that prior-year period included prior-year period. only two months of income from Dade Behring. PPA effects and inte- Healthcare’s first-quarter revenue gration costs related to acquisitions and orders rose 11% and 3%, respec- reduced Diagnostics’ profit margin tively, including new volume from by approximately 760 basis points in the acquisition of Dade Behring. the current quarter, including PPA Book-to-bill for the Sector was 0.99 effects of €46 million and integra- compared to 1.06 in the same quar- tion costs of €20 million. ter a year ago. Profit Sector Profit margin Sector New Orders & Revenue Sector 14-17% 1.06 0.99 (4)% 3% 3% 11% 2,806 2,653 2,896 2,936 3% 332 342 12.5% 11.6% Q1 2008 Q1 2009 Figures in millions of € Figures in millions of € Q1 2008 Q1 2009 Actual change Q1 2008 Q1 2009 Margin range New Orders Revenue Book-to-bill Actual change vs. previous year Adjusted change vs. previous year

Sectors 10 A year earlier, first-quarter PPA and more than 20% in the current pe- Solutions business impacted integration costs at Diagnostics were riod, benefiting from an additional by further charges Healthcare Workflow & Solutions posted a loss €51 million and €35 million, respec- month of volume from Dade Behring of €6 million in the first quarter. This tively, and cut more than 1200 basis compared to the prior-year period. result included €41 million in further points from profit margin. Revenue On an organic basis, revenue rose charges related to project delays in and orders for the Division both rose 2% and orders were up 1%. the particle therapy business, partly offset by €11 million in divestment gains. Profit by Division 24% n/a 13% 83 67 35 232 262 (6) Imaging & IT Workflow & Solutions Diagnostics Figures in millions of € Q1 2008 Q1 2009 Actual change Profit margin by Division 14-17% 11-14% 16-19% 14.8% 14.1% 10.1% 9.5% 9.4% (1.6)% Imaging & IT Workflow & Solutions Diagnostics Q1 2008 Q1 2009 Margin ranges New Orders & Revenue by Division New Orders: Weight of Divisions* 60% Imaging & IT New Orders Diagnostics 29% (2)% (17)% 1% 1% (15)% 21% 11% 1,755 1,769 396 335 713 864 Workflow & Solutions Workflow & Imaging & IT Diagnostics Revenue: Weight of Divisions* Solutions Imaging & IT 59% 4% 6% 2% Diagnostics 29% Revenue 7% 7% 22% 12% 1,650 1,769 348 373 712 872 Workflow & Solutions Figures in millions of € • • Q1 2008 Q1 2009 Actual change Adjusted change * unconsolidated basis

Equity Investments and Cross-Sector Businesses 11 Equity Investments and Cross-Sector Businesses Higher profits benefit from of Equity Investments include Nokia increase benefited from sales of lower loss related to NSN Siemens Networks B.V. (NSN) and equity investments. In addition, the Equity Investments includes equity Bosch und Siemens Hausgeräte equity investment loss related to stakes not allocated to a Sector or GmbH. Equity investments in the NSN fell to €7 million from €37 mil- Cross-Sector Business by reason of first quarter recorded a profit of €85 lion in the prior-year period. Income strategic fit as well as available-for- million compared to €36 million in from Equity Investments is expected sale securities. Major components the first quarter a year earlier. The to be volatile in coming quarters. Lower contribution from Cross-Sector Businesses Siemens IT Solutions and Services quarter a year earlier. Revenue de- the prior-year level at €1.231 billion. posted a profit of €46 million com- clined 4% year-over-year, to €1.289 On an organic basis, revenue was up pared to €70 million in the first billion. Orders came in slightly above 1% and orders rose 6%. Profit margin New Orders & Revenue Profit 0.96 0.91 5-7% 6% 1% 0% (4)% (34)% 1,225 1,340 1,231 1,289 70 46 5.2% 3.6% Q1 2008 Q1 2009 Figures in millions of € Figures in millions of € Q1 2008 Q1 2009 Margin range New Orders Revenue Book-to-bill Q1 2008 Q1 2009 Actual change Actual change vs. previous year Adjusted change vs. previous year Income before income taxes at Sie- equity business. Total assets rose to Income before income taxes divided mens Financial Services (SFS) de- €12.042 billion, driven in part by by average allocated equity, which clined, due primarily to a significant growth in customer financing activ- was €1.129 billion in the first quar- increase in reserves for the commer- ity. Return on Equity (ROE) de- ter of fiscal 2009 and €863 million in cial finance business. This was partly creased but remained above the the first quarter of fiscal 2008. offset by a higher profit in the target range. ROE calculated as Profit Total Assets ROE 20-23% 6% (14)% 77 66 11,328 12,042 35.7% 23.4% Figures in millions of € Figures in millions of € Q1 2008 Q1 2009 Actual change Sept. 30, 2008 Dec. 31, 2008 Q1 2008 Q1 2009 RoE range Actual change

Other Operations, Corporate Activities and Eliminations 12 Other Operations, Corporate Activities and Eliminations SHC divested as close-out of Real estate disposals continue obligation and a positive effect re- Other Operations progresses Income before income taxes at SRE lated to shifting an employment Other Operations consist primarily of was €45 million in the first quarter, bonus program from cash-based to operating business activities not down from €139 million in the same share-based payment. allocated to a Sector or Cross-Sector period a year earlier, primarily due to Business. By the end of fiscal 2009, lower gains from sales of real estate. Centrally carried pension expense these activities are to be integrated SRE intends to continue real estate swung to a negative €70 million into a Siemens Sector or Cross- disposals in coming quarters, de- from a positive €23 million in the Sector Business, divested, moved to pending on market conditions. first quarter a year earlier, due pri- a joint venture, or closed. During the marily to higher benefit costs related first quarter, Siemens again made Central costs fall on lower com- to Siemens’ principal pension plans good progress in the implementa- pliance expenses, one-time gains compared to the prior-year period. tion of the program. Accordingly, Corporate items and pensions first-quarter revenue fell to €264 totaled a negative €236 million in Impact from U.S. million from €708 million in the the first quarter compared to a nega- interest rate hedges prior-year period, and the loss from tive €315 million in the same period Income before income taxes from a year earlier. The improvement was Other Operations dropped to €13 Eliminations, Corporate Treasury and million from €64 million in the first due to Corporate items, which were other reconciling items in the first quarter a year earlier. The prior-year a negative €166 million compared to quarter was a negative €263 million period included a goodwill impair- a negative €338 million in the prior- compared to a negative €99 million ment of €70 million related to a year period. Within this change, in the prior-year period. The decline building and infrastructure business, expenses for outside advisors en- was due mainly to results of hedging and a profit of €14 million at Sie- gaged in connection with investiga- activities not qualifying for hedge mens Home and Office Communica- tions into legal and regulatory mat- accounting related to a decline in tion Devices (SHC). As previously ters fell to €49 million from €93 U.S. dollar interest rates. reported, Siemens completed the million in the first quarter a year transfer of an 80.2% stake in Sie- earlier. In addition, the current pe- mens Home and Office Communica- riod benefited from a gain relating tions Devices GmbH & Co. KG to to a major asset retirement ARQUES Industries AG at the beginning of the current quarter.

Subsequent Events & Outlook 13 Subsequent Events On January 26, 2009, after the close of the first quarter, Siemens announced that it will terminate the Shareholders Agreement for the joint venture Areva NP S.A.S. as con- tractually specified effective latest January 30, 2012, and sell its 34% minority interest in Areva NP S.A.S. to the majority shareholder Areva S.A. under the terms of a put agreement. The transaction is subject to the approval of antitrust au- thorities. Outlook Achieving previously announced diminish due to continued adverse income targets for fiscal 2009 has market development. This outlook become even more ambitious due to excludes impacts from legal and market conditions. Total Sectors regulatory matters. As in the past, profit is targeted to reach €8.0 to Siemens continues to closely moni- €8.5 billion in fiscal 2009, provided tor global financial and macroeco- that customers do not materially nomic developments and their po- slow conversion of booked orders to tential impact on Siemens. revenue and pricing does not further

Note and Disclaimer 14 Note and Disclaimer Earnings before interest and taxes, accordance with IFRS in our Consoli- All figures are preliminary and un- or EBIT (adjusted); Earnings before dated Financial Statements. Infor- audited. This Earnings Release should interest, taxes, depreciation and mation for a reconciliation of these be read in conjunction with informa- amortization, or EBITDA (adjusted); amounts to the most directly compa- tion Siemens published today regard- Return on capital employed (ROCE); rable IFRS financial measures is ing legal proceedings. More detailed Return on equity (ROE); Free cash available on our Investor Relations disclosure, particularly regarding legal flow; and Cash conversion rate are website under proceedings, is provided in the annual non-GAAP financial measures. These report. www.siemens.com/investors -> Finan- non-GAAP financial measures should cial Publications. “Profit Total Sectors” not be viewed in isolation as alterna- is reconciled to “Income from con- Financial Publications are available for tives to measures of our financial tinuing operations before income download at: condition, results of operations or taxes” in the table “Segment Infor- www.siemens.com/ir Publications & cash flows as presented in mation.” Events. Beginning today at 07:45 a.m. CET, This document contains forward- crises; future financial performance of the press conference at which CEO looking statements and information – major industries that we serve, includ- Peter Löscher and CFO Joe Kaeser that is, statements related to future, ing, without limitation, the Sectors discuss the quarterly figures will be not past, events. These statements Industry, Energy and Healthcare; the broadcast live on the Internet at may be identified by words such as challenges of integrating major acquisitions and implementing joint ven- www.siemens.com/pressconference. “expects,” “looks forward to,” “antici- A recording of the press conference pates,” “intends,” “plans,” “believes,” tures and other significant portfolio will subsequently be made available “seeks,” “estimates,” “will,” “project” or measures; introduction of competing as well. Starting at 08:45 CET, Peter words of similar meaning. Such state- products or technologies by other Löscher and Joe Kaeser will hold a ments are based on our current expec- companies; lack of acceptance of new telephone conference in English for tations and certain assumptions, and products or services by customers analysts and investors, which can be are, therefore, subject to certain risks targeted by Siemens; changes in busi- followed live at and uncertainties. A variety of factors, ness strategy; the outcome of pending investigations and legal proceedings, www.siemens.com/analystcall. many of which are beyond Siemens’ control, affect our operations, per- including corruption investigations to Starting today at 10 a.m. CET, we formance, business strategy and re- which we are currently subject and will also provide a live video webcast sults and could cause the actual re- actions resulting from the findings of on the internet of Chairman of the sults, performance or achievements of these investigations; the potential Supervisory Board Dr. Gerhard Siemens to be materially different impact of such investigations and Cromme's and CEO Peter Löscher's from any future results, performance proceedings on our ongoing business speeches to the Annual Sharehold- or achievements that may be ex- including our relationships with gov- ers' Meeting at the Olympic Hall in pressed or implied by such forward- ernments and other customers; the Munich, Germany. You can access looking statements. For us, particular potential impact of such matters on the webcast at uncertainties arise, among others, our financial statements; as well as various other factors. More detailed www.siemens.com/pressconference. from changes in general economic and A video of the speeches will be avail- business conditions (including margin information about certain of these able after the live webcast. developments in major business areas factors is contained throughout this and recessionary trends); the possibil- report and in our other filings with the ity that customers will delay conver- SEC, which are available on the Sie- sion of booked orders into revenue or mens website, www.siemens.com, that our pricing power will be dimin- and on the SEC’s website, ished by continued adverse market www.sec.gov. Should one or more of developments, to a greater extent these risks or uncertainties materialize, than we currently expect; the behavior or should underlying assumptions of financial markets, including fluctua- prove incorrect, actual results may tions in interest and exchange rates, vary materially from those described in commodity and equity prices, debt the relevant forward-looking state- prices (credit spreads) and financial ment as expected, anticipated, in- assets generally; continued volatility tended, planned, believed, sought, and further deterioration of the capital estimated or projected. Siemens does markets; the commercial credit envi- not intend or assume any obligation to ronment and, in particular, additional update or revise these forward-looking uncertainties arising out of the sub- statements in light of developments prime, financial market and liquidity which differ from those anticipated.

Siemens Q1 2009 earnings release

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Notes on slide 1

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