Siemens (ETR: SIE), the largest industrial group in Europe, has forecasted a return to growth in 2016 after experiencing a year of upheaval. The company has cut thousands of jobs in its energy division, and has sold off its remaining consumer businesses.
Siemens was the first to provide a forecast for the upcoming year in the industry, and the company forecasted moderate sales growth, a double-digit jump in earnings per share, and faster order growth. The improved performance was helped by cost cuts in its headquarters and other corporate areas.
The company also reported strong orders for the fourth quarter, which included the first payment of Egypt’s historic €8 billion power order.
With higher-than-expected profit from its industrial business segments, the company was able to reach its margin target for the year, which was 10.1%. This figure was still well below its rival General Electric, but on par with the Swiss group ABB.
Siemens has also announced a share buyback program for €3 billion that will take place over the next three years and increased its dividend to €3.5 per share, up from €3.3 per share.
Company shares were up 3.4% to trade at €95.32.
Siemens’ fourth-quarter industrial profit jumped to €2.6 billion, up 9%. Profits were helped by improvements in wind and power renewables, energy management, transport and healthcare.