By Kim Richters
Siemens AG on Thursday set new targets for stronger revenue growth and said it would launch a share buyback program of up to 3 billion euros ($3.58 billion).
The German engineering conglomerate said it would target comparable annual revenue growth for the group of 5% to 7% over its business cycle of the next three to five years, up from previously 4% to 5%.
In its Digital Industries business, Siemens will transfer a significant part of the software business to a software-as-a-service offering, reporting annual recurring revenue. Due to the transition and related effects, Siemens kept the division's target for a profit-margin range of 17% to 23%.
It adjusted targets for profit margins in the Smart Infrastructure and Mobility divisions. Smart Infrastructure now aims for a margin of 11% to 16% --previously 10% to 15%-- and Mobility is targeting 10% to 13, from 9% to 12%.
The targets apply from the company's fiscal year 2022, which starts in October.
"Digitalization, automation and sustainability are growth engines for our business. Here, our core business and our digital business reinforce each other in a virtuous cycle," said Siemens's Chief Executive Roland Busch.
Siemens will also start a share buyback program of up to EUR3 billion that will run from October for five years. It also said its total shareholder return would include a progressive dividend policy.
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(END) Dow Jones Newswires
June 24, 2021 03:35 ET (07:35 GMT)Copyright (c) 2021 Dow Jones & Company, Inc.