Profit at Siemens falls 27pc
SHARES in Siemens closed down 2.8pc after Europe's largest engineering company reported earnings that missed estimates.
The company predicted that Europe would slip into recession in the coming months.
Profit after tax from continuing operations fell 27pc to €1.36bn in the fiscal first quarter. New orders also dropped and chief executive Peter Loescher admitted making this year's targets would be harder.
The European economy would encounter a "mild" contraction in coming quarters and Siemens would work to capture growth in the US and emerging markets, where growth has held up, Mr Loescher said.
Siemens is among the first major industrial companies to report earnings for the final three months of 2011.
The results offer a glimpse into the health of global demand with products spanning trains, power turbines, medical scanners and factory automation gear.
"Siemens now needs a strong second half to reach its goals, and the cyclical businesses must hold up," said Ingo-Martin Schachel, an analyst at Commerzbank in Frankfurt. (Bloomberg)