Double-digit imaging & IT growth propels Siemens Healthcare's Q3

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Image source: Siemens Healthcare

Siemens AG today reported a EUR118 million ($153.7 million U.S.) increase in net income, with an overall revenue gain of 4 percent, partly driven by strong healthcare unit revenue, which increased 10 percent year-over-year with contributions from all divisions in the fiscal 2010 third quarter, compared with the previous year’s third quarter.

Overall, 2010 third quarter orders for healthcare climbed 18 percent and revenue rose 10 percent. Siemens said that orders came in higher in all three geographic regions compared with the prior-year quarter, while revenue rose in Asia, Australia and the Americas.

Its healthcare sector experienced an 18 percent increase in new orders.

The healthcare sector’s third-quarter profit rose to €506 million ($659 million U.S.) on higher revenue and “continued cost discipline,” said the company. For comparison, profit in the 2009 third quarter was burdened by €128 million ($166.78 million U.S.) in charges at the workflow and solutions division, while the current period benefited from a gain of €40 million ($52 million U.S.), taken at the sector level, related to a joint venture.

For the healthcare sector, purchase price accounting (PPA) effects related to past acquisitions in diagnostics were €46 million ($59.9 million U.S.) in this year’s third quarter. In addition, healthcare recorded €18 million of integration costs associated with the next phase of integration activities in diagnostics. In the same quarter a year earlier, PPA effects and integration costs totaled €52 million ($67.7 million U.S.).

Specifically the imaging and IT division delivered double-digit increases in revenue and orders compared to the third quarter of 2009. “Profit climbed to €329 million ($428 million U.S.) on higher revenue and structural cost savings,” the company reported. The 2010 third quarter revenue for its imaging and IT unit came in 11 percent higher year-over-year, and orders climbed 21 percent. Growth in imaging and IT was driven by strong demand in Asia, Australia, particularly including China, and in the Americas region, which saw growth in Brazil from a small base.

Its workflow and solutions division contributed €22 million ($28.6 million U.S.) to healthcare sector profit, with double-digit order growth, compared with a loss of €107 million ($139.2 million U.S. in the prior-year period, when the division took the €128 million ($166.5 million U.S.) in project charges mentioned earlier.