By John Revill

ZURICH (Reuters) -Siemens reported first-quarter revenue barely forward of expectations on Thursday regardless of the German engineering group seeing a slowdown at its flagship manufacturing facility automation unit.

Digital Industries, which provides corporations with software program and controllers to function their manufacturing traces, noticed new orders fall by a 3rd and revenue by a fifth as market circumstances weakened.

Like different main industrial corporations, Siemens’s outcomes are seen as a barometer of the worldwide economic system.

Prospects that beforehand constructed up shares of elements to keep away from shortages additionally held off shopping for new tools and determined to run down their shares, Siemens mentioned.

The downturn was seen most strongly in Asia and Australia, due notably to weakening demand from China, it added.

Though the state of affairs in China was enhancing from the earlier quarter, Siemens mentioned it anticipated circumstances to stay powerful in its third largest market after the US and Germany.

“We anticipate regional variations in the way in which clients in the end scale back their inventories to regular ranges,” Chief Govt Roland Busch advised reporters.

“Relying on the pace and scale of its financial restoration, China would possibly take considerably longer.”

The development might proceed into the second half of its 2024 monetary yr, Siemens mentioned.

Nonetheless, a stronger efficiency from its train-making Mobility enterprise helped offset the downturn, whereas Siemens’s constructing automation arm Good Infrastructure had its best-ever quarter.

Busch mentioned the Pink Sea delivery disaster was having “virtually no impression” on Siemens, attributable to its native provide chains and expertise in dealing with such issues.

Busch pointed to an order backlog, which now stood at 113 billion euros and Siemens’s highest ever, as giving him confidence for the long run.

General, Siemens reported an increase in industrial revenue of three% to 2.72 billion euros ($2.93 billion) for the three months to the tip of December, beating forecasts of two.64 billion euros in a company-gathered consensus of analysts.

Income rose 2% to 18.41 billion euros, under the 18.58 billion euros forecast after forex translation results – primarily from a stronger greenback – decreased gross sales reported in euros.

Siemens confirmed its full yr outlook, saying it nonetheless anticipated income progress of 4% to eight%, after divestments and when forex results are eliminated.

The corporate’s inventory opened 2.5% decrease after the outcomes, which Jefferies described a stable however lagging friends like France’s Schneider Electrical (EPA:).

($1 = 0.9276 euros)