Edgar Filing: SIEMENS AKTIENGESELLSCHAFT

SIEMENS 6-K

FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934

For July 24, 2003

Commission File Number: 1-15174

Siemens Aktiengesellschaft
(Translation of registrant’s name into English)

Wittelsbacherplatz 2
D-80333 Munich
Federal Republic of Germany
(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F x Form 40-F o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes o No x

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes o No x

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes o No x

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-

TABLE OF CONTENTS


Key figures
SEGMENT INFORMATION (unaudited)
CONSOLIDATED STATEMENTS OF INCOME (unaudited)
CONSOLIDATED STATEMENTS OF CASH FLOW (unaudited)
CONSOLIDATED BALANCE SHEETS (unaudited)
SIGNATURES

(SIEMENS LOGO)

Key figures

3^rd quarter⁽¹⁾

first nine months⁽²⁾

2003

2002

2003

2002

Net income

(in millions of euros)

632

725

1,721

⁽³⁾

2,544

Earnings per share

(in euros)

0.71

0.81

1.93

2.86

Net cash from operating and investing activities

(in millions of euros)

266

1,466

527

3,206

therein:

Net cash provided by operating activities

2,038

2,094

3,310

4,347

Net cash used in investing activities

(1,772

)

(628

)

(2,783

)

(1,141

)

Group profit from Operations

(in millions of euros)

1,023

1,098

3,193

3,049

New orders

(in millions of euros)

17,215

19,033

56,444

66,854

⁽⁴⁾

Sales

(in millions of euros)

17,380

20,482

54,455

62,726

⁽⁴⁾


		June 30, 2003		September 30, 2002

Employees (in thousands)			417		426
	Germany		171		175
	International		246		251

(1)		April 1 — June 30.
(2)		October 1 — June 30.
(3)		Includes a positive effect of €36 million (or €0.04 per share) due to the adoption of SFAS 143, Accounting for Asset Retirement Obligations.
(4)		Beginning December 5, 2001 Infineon is accounted for under the equity method of accounting and is no longer consolidated in the financial statements of Siemens. Therefore, in fiscal year 2002, Infineon’s orders and sales are included only for the approximately two months in which Infineon was consolidated in the financial statements of Siemens.

Note: Beginning during the second quarter of fiscal 2003, Siemens replaced the term “EBIT from Operations” with “Group profit from Operations.” This change and further terminology changes made in the second quarter are explained on the page “Terminology update” at the end of this document. “Group profit from Operations” is reconciled to “Income before income taxes” of Operations under “Reconciliation to financial statements” on the table “Segment information.”


		Press Presse Prensa For the business and financial press Munich, July 24, 2003

Siemens in the third quarter (April 1 to June 30) of fiscal 2003

•		Net income was €632 million, compared to €725 million in the third quarter a year earlier.

•		Group profit from Operations was €1.023 billion, compared to €1.098 billion in the same period a year ago. A majority of Siemens Groups increased their earnings.

•		Sales of €17.380 billion and orders of €17.215 billion were down 15% and 10%, respectively, from the third quarter a year earlier. Excluding currency translation and the net effect of acquisitions and dispositions, orders were down 1% and sales were down 7%.

•		Net cash from operating and investing activities for the first nine months of fiscal 2003 was €527 million. Net cash of €3.206 billion in the same period a year earlier benefited from €945 million in net proceeds from portfolio activities. Net cash in the current nine-month period included an acquisition payment of €505 million and approximately €850 million of increases in investments and marketable securities.

For the third quarter of fiscal 2003, Group profit from Operations was €1.023 billion, near the level a year earlier despite a €3.1 billion decline in sales. A majority of operating Groups improved both profits and earnings margins for the quarter. While Power Generation’s (PG) Group profit was lower due to the end of the gas turbine boom in the U.S., it remained among Siemens’ earnings leaders in the third quarter, along with Medical Solutions (Med), Automation and Drives (A&D), Siemens VDO Automotive (SV), and Osram.

Third-quarter net income of €632 million came in lower than the €725 million a year earlier. Non-allocated pension expense was €189 million compared to €61 million a year earlier, and Siemens’ equity share of the net loss at Infineon Technologies AG was higher in the current quarter, €43 million compared to €31 million a year earlier. In addition, the prior-year period included a €67 million gain on the sale of an investment. Earnings per share for the quarter were €0.71, compared to €0.81 a year earlier.

Net cash from operating and investing activities for the third quarter was €266 million, including an initial payment of €505 million to acquire the industrial turbine business of Alstom S.A. and €741 million in increases in investments and marketable securities. Excluding these items, net cash from operating and investing activities was €1.512 billion, compared to €1.466 billion in the same period a year earlier. For the first nine months of fiscal 2003, net cash from operating and investing activities was €527 million, including the items mentioned above as well as supplemental pension contributions totaling €442 million in the first quarter. Net cash from operating and investing activities in the first nine months a year earlier was €3.206 billion, including net cash provided from portfolio activities totaling €945 million related to transactions involving Infineon and Atecs Mannesmann.

Reflecting global macroeconomic conditions, all Siemens’ operating Groups reported weak sales and orders compared to the third quarter a year earlier, resulting in aggregate declines of 15% in sales, to €17.380 billion, and 10% in orders, to €17.215 billion. Negative currency translation effects, particularly involving the U.S. dollar, affected reported sales and orders across the board. Excluding currency translation and the net effect of acquisitions and dispositions, third-quarter sales declined 7% and orders edged down 1% year-over-year.

“I am satisfied with our third-quarter result,” said Siemens CEO Heinrich v. Pierer. “While the absence of demand growth in key markets, combined with significant currency translation effects, lowered sales and orders year-over-year, the trend is more gradual on a consecutive-quarter basis. It is even more satisfying that most of our Groups were able to move further toward their target earnings ranges for fiscal 2003. I expect a similarly positive performance in the fourth quarter. Clearly the Operation 2003 measures are taking effect, and they are being consistently applied.”

Operations in the third quarter of fiscal 2003

In the Information and Communications business area, Information and Communication Networks, (ICN) reported a loss of €125 million, including €72 million in charges primarily at Efficient Networks. On a consecutive quarter basis, ICN’s Group Profit margin improved. Third-quarter earnings at the Enterprise Networks division were €62 million, up from the prior-year period, but revenue declined to €893 million from €955 million a year earlier due to currency translation effects. ICN’s Carrier Networks and Services business also reported lower sales year-over-year, €801 million compared to €1.108 billion, and posted a loss of €128 million. The division’s third-quarter loss a year earlier was €183 million. For ICN as a whole, sales dropped 23% to €1.687 billion from €2.190 billion in the prior-year period, including a 6% negative currency translation effect. Third-quarter orders declined 13% year-over-year, to €1.756 billion, with nearly half the decrease due to currency translation.

Information and Communication Mobile (ICM) recorded Group profit of €17 million in the third quarter, including a number of one-time net positive effects at the Mobile Phones and Mobile Networks divisions. In the same period a year earlier, ICM posted a loss of €9 million. The Mobile Networks division posted a profit of €36 million on sales of €968 million, compared to a loss of €21 million on sales of €1.218 billion in the third quarter of the prior year. The Mobile Phones division recorded sales of €922 million on a volume of 8.1 million handsets, similar to the level a year earlier, but posted a loss of €42 million. For comparison, Mobile Phones posted a profit of €28 million in the same quarter a year earlier. Third-quarter sales for ICM as a whole fell 14%, to €2.160 billion. Orders were down 2%, at €2.313 billion. Excluding currency translation effects, sales fell 10% and orders grew 5%.

Siemens Business Services (SBS) posted Group profit of €17 million, up from €5 million in the third quarter a year earlier. Continuing weak demand for information technology (IT) services caused third-quarter sales to decline 6%, to €1.283 billion, and orders to decline 7%, to €1.297 billion.

In the Automation and Control business area, A&D continued to produce outstanding earnings in a difficult environment, raising its Group profit to €203 million and its margin to nearly 10% in the third quarter. The Group’s Industrial Automation Systems and Motion Control Systems divisions again led the way. A&D also strengthened its overall market position with innovative new products across the Group that helped offset pricing pressure and weak demand in the U.S. Excluding currency translation effects, sales grew 3% and orders rose 6% year-over-year. Third-quarter sales of €2.074 billion were just 3% lower than a year ago, while orders held steady at €2.078 billion.

Industrial Solutions and Services (I&S) recorded €5 million in Group profit, compared to a loss of €32 million in the third quarter a year earlier, when the Group took charges to reduce capacity in a contracting market for industrial solutions. Market conditions remain difficult, as third-quarter sales declined 10%, to €959 million, and orders fell 8%, to €911 million. Both sales and orders included a five percentage point negative currency translation effect.

Siemens Dematic (SD) battled weak markets, project delays, and margin pressures, recording a Group loss of €64 million including €39 million in charges for capacity reduction, inventory write-downs, and increased contract loss provisions for existing project risks. Third-quarter Group profit a year earlier was €12 million. While the Electronics Assembly Systems division began to restore sales growth in its large pick-and-place business on a near-break-even basis, its smaller businesses posted losses. The Postal Automation division stayed in the black despite falling sales. The Material Handling Automation division, however, experienced volume-driven earnings declines in the U.S., took most of the charges mentioned above related to projects in Europe, and posted a significant loss compared to a profit a year earlier. SD’s third-quarter sales of €640 million were down 14% year-over-year, with currency translation accounting for 11 percentage points of the decrease. Orders dropped 24%, to €571 million, including eight percentage points due to currency translation.

Group profit at Siemens Building Technologies (SBT) was €18 million, including €20 million in charges primarily to reduce capacity. Group profit was €23 million in the third quarter a year earlier. Reflecting weakening demand in the construction market, sales fell 10% year-over-year, to €1.156 billion, and orders were down 11%, at €1.137 billion.

Currency translation effects cut eight percentage points from SBT’s sales growth, and seven points from order growth.

In the Power business area, PG’s third-quarter Group profit of €279 million was down from the €476 million level a year earlier, near the peak of the U.S. gas turbine energy boom. The current period includes net gains of €65 million from customer cancellations, and the prior year period benefited from a €44 million gain related to revised estimates of project performance. While third-quarter sales were significantly lower than a year earlier, at €1.530 billion, orders were down just 3% year-over-year, at €1.596 billion. Excluding a 5% currency translation effect, orders rose as PG continued to expand its business with major new orders in Asia/Pacific, Europe, and the Middle East. The Group’s service business grew faster than PG as a whole, and accounted for approximately one-third of Group sales and delivered robust Group profit in the third quarter. PG’s acquisition of Alstom’s small gas turbine business, which was consolidated as of May 1, 2003, made only a modest contribution to sales and earnings growth during the period. PG’s order backlog was €14.5 billion, comparable to recent quarters.

Power Transmission and Distribution (PTD) delivered Group profit of €52 million compared to €43 million in the third quarter a year ago, and boosted its Group profit margin to 6.0% despite a decline in sales. The Group’s High Voltage and Medium Voltage divisions increased their profitability year-over-year. The aggregate effects of currency translation and the divestment of PTD’s Metering division between the two periods under review strongly influenced both sales and orders, by a negative 20% and 21%, respectively. Excluding these effects, PTD’s sales rose 7% and orders grew 11%. Including these effects, sales fell 13%, to €869 million, and orders declined 10%, to €868 million.

In the Transportation business area, Transportation Systems (TS) improved third-quarter Group profit to €74 million from €61 million a year earlier, and raised its earnings margin more than a point to 6.7%. Third-quarter sales of €1.100 billion were unchanged from the level a year earlier, as TS continued to convert previous large orders into current business. While third-quarter orders of €732 million were down 19% year-over-year, including six percentage points due to currency translation, the Group’s order backlog kept pace with recent quarters, at €11.2 billion.

SV further stabilized its earnings position, achieving €111 million in Group profit and improving its earnings margin more than two full points. Diesel injection systems and onboard infotainment systems supported profitability. Both sales and orders were €2.090 billion, down 6% year-over-year, partly caused by the previously communicated transfer of SV’s approximately €800 million (annualized) automotive cockpit module business to an existing joint venture with Faurecia on May 31, 2003. Excluding this transfer and a 6% negative currency translation effect, SV’s sales and orders grew year-over-year.

In the Medical business area, Med led all Siemens Groups with €332 million in Group profit, including a €74 million gain related to the contribution of a portion of its electromedical systems business to its joint venture with Dräger Medical. For comparison, Group profit a year earlier was €243 million. Healthy demand for Med’s innovative imaging systems contributed strongly to quarterly results. Excluding currency translation effects that cut 13 percentage points from sales growth and 12 points from order development, Med increased sales 4% and orders 1% compared to the prior-year quarter despite slower market growth, particularly in the U.S. Including currency translation, third-quarter sales of €1.721 billion were down 9% and orders of €1.702 billion declined 11% year-over-year.

In the Lighting business area, Osram raised its earnings margin above 10% and recorded Group profit of €98 million, compared to €102 million a year earlier. Higher-margin new products continued to brighten Osram’s profitability picture, especially at the Opto Semiconductors division. Excluding currency translation effects that cut 12 percentage points from sales and order growth, volume grew 2% compared to the prior-year quarter. Including currency translation, third-quarter sales and orders of €968 million were down 10% year-over-year.

Other operations consist primarily of non-Group-related operating activities and centrally-held operating equity investments. For the third quarter, other operations contributed Group profit of €6 million, compared to a negative €3 million in the same period a year earlier.

Corporate items, pensions and eliminations

Corporate items, pensions, and eliminations were a negative €377 million in the third quarter, compared to a negative €206 million in the same period a year earlier, which included a gain of €67 million on the sale of an investment. Corporate costs were €150 million, down from €165 million a year earlier. Non-allocated pension expense was higher in the current period, €189 million compared to €61 million a year earlier, and Siemens’ equity share of Infineon’s net loss was also higher, at €43 million compared to €31 million a year earlier.

Financing and Real Estate

Income before income taxes at Siemens Financial Services (SFS) was €71 million, down from €83 million in the third quarter a year earlier, a period that included a high level of investment income. Third-quarter results for Siemens Real Estate (SRE) rose year-over-year, to €77 million from €53 million, as gains from dispositions of real estate assets and reduced financing costs from lower interest rates more than offset the effects of lower occupancy rates.

Income Statement highlights for the third quarter

Net sales for Siemens worldwide were €17.380 billion in the third quarter, compared to €20.482 billion in the same period a year earlier. Net income for Siemens worldwide was €632 million compared to €725 million in the same quarter a year ago.

In Operations, net sales were €17.249 billion, down from €20.308 billion a year earlier. Gross profit margin increased to 28.9% from 28.0%. Among the Groups, in particular Med and SV recorded significantly higher margins as SD and PG reported lower results. Research and development expense was 7.2% of sales, compared to 7.0% in the third quarter a year earlier. Marketing, selling and general administrative expense was 18.1% of sales, up from 17.4% a year ago. Other operating income (expense), net was a positive €81 million, including €65 million in net gains from customer cancellations at PG and a €74 million gain arising from Med’s contribution of assets to a joint venture. Other operating income last year was €43 million, which included a €56 million gain on the sale of a business. Income from investments in other companies was a negative €3 million, down from €48 million in the prior-year period which included a €67 million gain on the sale of an investment.

Sales and order trends in the first nine months

Orders for the first nine months were €56.444 billion, down 16% from €66.854 billion a year earlier, and sales fell 13% to €54.455 billion from €62.726 billion. Excluding currency and the net effect of acquisitions and dispositions, the declines in orders and sales were 8% and 5%, respectively. Orders in Germany for the first nine months of fiscal 2003 were €12.654 billion, down 7% compared to the same period a year earlier. Sales in Germany decreased 7% to €12.282 billion. International orders dropped 18% year-over-year, to €43.790 billion. Excluding currency translation and the net effects of acquisitions and dispositions, the decline in international orders was 9%. International sales of €42.173 billion declined 15% year-over-year. Excluding currency translation and the net effects of acquisitions and dispositions, international sales decreased 5%.

Orders in the U.S. for the first nine months were down 36%, to €10.786 billion. Sales in the U.S. declined 25%, to €11.517 billion, driven by expected volume declines at PG following the end of the gas turbine energy boom and by a negative 15% currency translation effect. Nine-month orders in Asia-Pacific fell 7% to €7.526 billion and sales fell 17% year-over-year, to €6.106 billion, in part due to currency translation and the net effect of acquisitions and dispositions. Sales in China fell 19% to €1.922 billion in the first nine months of the current fiscal year, due in large part to the effect of currency translation and dispositions.

Income and earnings per share in the first nine months

Net income for the first nine months of fiscal 2003 was €1.721 billion. Net income for the first nine months a year earlier was €2.544 billion, including non-taxable gains of €936 million related to the sale of shares in Infineon. On a comparable basis, net income improved year-over-year, as did Group profit from Operations, which rose to €3.193 billion from €3.049 billion a year earlier. Earnings per share for the first nine months of this year were €1.93 compared to €2.86 for the same period a year ago.

Liquidity and Balance Sheet highlights for the first nine months

For Siemens worldwide, net cash from operating and investing activities for the first nine months of fiscal 2003 was €527 million. Net cash provided by the operating activities of the Operations component for the first nine months of fiscal 2003 was €1.532 billion after €442 million in supplemental cash contributions to Siemens’ pension trusts in Germany and the U.K. Changes in net working capital (current assets less current liabilities) within Operations used cash of €1.897 billion due in part to a decrease in other current liabilities in particular at PG, as a result of lower advance payments resulting from order cancellations in the U.S. Changes in net working capital in the current period also reflect an increase of inventories, particularly at SD and TS.

Net cash used in investing activities within Operations was €2.482 billion in the first nine months of this fiscal year, including PG’s €505 million initial payment for the acquisition of Alstom’s industrial turbine business and the majority of the worldwide total of approximately €850 million in increases of investments and marketable securities. Investing activities in the first nine months a year ago included transactions related to Siemens’ acquisition of Atecs Mannesmann, most prominently a cash payment of €3.7 billion to Vodafone AG, partially offset by approximately €3.1 billion received from the disposition of Atecs businesses held for sale. The prior-year period also included sales of Infineon shares that generated proceeds totaling €1.522 billion.

Net cash provided by operating activities within the Financing and Real Estate component for the first nine months of fiscal 2003 was €388 million supported by strong earnings, in particular from SFS. Investing activities for the Financing and Real Estate component provided €15 million in net cash during the current nine-month period.

Net cash provided by operating activities of Siemens worldwide was €3.310 billion for the first nine months of fiscal 2003. In addition to the factors noted above, net cash includes a decrease in other current assets of €823 million, primarily from financial instruments related to our international business activities. Net cash used in investing activities of Siemens worldwide was €2.783 billion, influenced primarily by the investing activities of Operations, as noted above. Total assets decreased to €77.220 billion from €77.939 billion at September 30, 2002.

Funding Status of Pension Plans

During the nine-month period ended June 30, 2003, the funding status of Siemens’ principal pension plans improved by approximately €500 million compared to their status on September 30, 2002. The improvement is due primarily to a contribution of €377 million in real estate plus supplemental cash contributions totaling €442 million in the first quarter of fiscal 2003, combined with an increase in the market value of pension plan assets, whose asset allocation was modified during the current fiscal year, reduced by service and interest costs during the nine-month period.

Economic Value Added

Siemens worldwide EVA for the first nine months of fiscal 2003 was positive but lower compared to the same period a year ago, due primarily to nontaxable gains of €936 million on sales of shares in Infineon which occurred in the first two quarters a year earlier. Excluding these gains, EVA increased compared to the prior-year period.

Note: Foreign currency translation, particularly related to the U.S. dollar, can have a significant impact on reported orders and sales. Attached to this Earnings Release is a presentation of the additional impacts of currency translation and transaction exposure on Siemens resulting from the U.S. dollar.

Note: Siemens CEO Heinrich v. Pierer and CFO Heinz-Joachim Neubürger will hold an English-language telephone conference with analysts on July 24, 2003 at 12:00 p.m. CET. You can follow this conference live on the Internet by going to www.siemens.com/analystcall. A recording of the telephone conference will be available later at the same location.

This press release report contains forward-looking statements based on beliefs of Siemens’ management. The words “anticipate,” “believe,” “estimate,” “forecast,” “expect,” “intend,” “plan”, “should” and “project” are used to identify forward-looking statements. Such statements reflect the company’s current views with respect to future events and are subject to risks and uncertainties. Many factors could cause the actual results to be materially different, including, among others, changes in general economic and business conditions, changes in currency exchange rates and interest rates, introduction of competing products, lack of acceptance of new products or services and changes in business strategy. Actual results may vary materially from those projected here. Siemens does not intend or assume any obligation to update these forward-looking statements.


Siemens AG Corporate Communications Press Office 80312 Munich		Reference number: AXX200307.49 e Thomas Weber 80312 Munich Tel.: +49-89 636-32812; Fax: -36700 E-mail: th.weber@siemens.com

SIEMENS AG

SEGMENT INFORMATION (unaudited)
As of and for the three months ended June 30, 2003 and 2002 and as of September 30, 2002
(in millions of €)


														Intersegment
				New orders						External sales				sales						Total sales						Group profit⁽¹⁾

				2003			2002			2003		2002		2003			2002			2003			2002			2003			2002

Operations Groups
	Information and Communication Networks (ICN)				1,756			2,029			1,533		2,121		154			69			1,687			2,190			(125	)		(84	)
	Information and Communication Mobile (ICM)				2,313			2,359			2,124		2,472		36			34			2,160			2,506			17			(9	)
	Siemens Business Services (SBS)				1,297			1,398			992		1,007		291			360			1,283			1,367			17			5
	Automation and Drives (A&D)				2,078			2,077			1,751		1,853		323			283			2,074			2,136			203			193
	Industrial Solutions and Services (I&S)				911			992			692		800		267			269			959			1,069			5			(32	)
	Siemens Dematic (SD)				571			751			622		704		18			36			640			740			(64	)		12
	Siemens Building Technologies (SBT)				1,137			1,280			1,082		1,213		74			74			1,156			1,287			18			23
	Power Generation (PG)				1,596			1,648			1,529		2,387		1			13			1,530			2,400			279			476
	Power Transmission and Distribution (PTD)				868			966			795		951		74			51			869			1,002			52			43
	Transportation Systems (TS)				732			909			1,086		1,098		14			4			1,100			1,102			74			61
	Siemens VDO Automotive (SV)				2,090			2,229			2,088		2,227		2			2			2,090			2,229			111			68
	Medical Solutions (Med)				1,702			1,916			1,698		1,880		23			2			1,721			1,882			332			243
	Osram				968			1,072			946		1,069		22			4			968			1,073			98			102
	Other operations⁽⁵⁾				372			511			248		398		147			218			395			616			6			(3	)

			Total Operations Groups		18,391			20,137			17,186		20,180		1,446			1,419			18,632			21,599			1,023			1,098
Reconciliation to financial statements
	Corporate items, pensions and eliminations				(1,703	)		(1,658	)		21		132		(1,404	)		(1,423	)		(1,383	)		(1,291	)		(377	)		(206	)
	Other interest expense				—			—			—		—		—			—			—			—			(11	)		(14	)
	Gains on sales and dispositions of significant business interests				—			—			—		—		—			—			—			—			—			—
	Other assets related reconciling items				—			—			—		—		—			—			—			—			—			—

		Total Operations (for columns Group profit/Net capital employed, i.e. Income before income taxes/Total assets)			16,688			18,479			17,207		20,312		42			(4	)		17,249			20,308			635			878


																										Income before income taxes

Financing and Real Estate Groups
	Siemens Financial Services (SFS)				135			159			108		107		27			52			135			159			71			83
	Siemens Real Estate (SRE)				391			394			64		61		327			333			391			394			77			53
	Eliminations				—			—			—		—		(3	)		(2	)		(3	)		(2	)		—			—

			Total Financing and Real Estate		526			553			172		168		351			383			523			551			148			136

Eliminations, reclassifications and Corporate Treasury					1			1			1		2		(393	)		(379	)		(392	)		(377	)		43			4

Siemens worldwide					17,215			19,033			17,380		20,482		—			—			17,380			20,482			826			1,018

[Additional columns below]

[Continued from above table, first column(s) repeated]


										Net cash from										Amortization,
				Net capital						operating and						Capital				depreciation and
				employed⁽²⁾						investing activities						spending⁽³⁾				impairments⁽⁴⁾

				6/30/03			9/30/02			2003			2002			2003		2002		2003		2002

Operations Groups
	Information and Communication Networks (ICN)				738			1,100			(110	)		118			43		85		110		107
	Information and Communication Mobile (ICM)				1,681			1,973			105			218			89		101		83		93
	Siemens Business Services (SBS)				502			264			(56	)		102			56		57		60		67
	Automation and Drives (A&D)				1,952			2,197			315			355			49		52		55		60
	Industrial Solutions and Services (I&S)				222			315			42			(39	)		4		9		13		14
	Siemens Dematic (SD)				1,191			975			(88	)		(22	)		7		14		13		15
	Siemens Building Technologies (SBT)				1,550			1,778			38			101			21		27		27		42
	Power Generation (PG)				1,047			(144	)		(289	)		22			542		85		47		37
	Power Transmission and Distribution (PTD)				836			928			128			(55	)		14		22		16		18
	Transportation Systems (TS)				(30	)		(741	)		(131	)		120			19		23		14		16
	Siemens VDO Automotive (SV)				3,912			3,746			67			286			150		132		97		114
	Medical Solutions (Med)				3,355			3,414			212			261			90		52		59		46
	Osram				2,124			2,436			93			(8	)		54		79		65		73
	Other operations⁽⁵⁾				1,472			535			(473	)		141			471		18		14		9

			Total Operations Groups		20,552			18,776			(147	)		1,600			1,609		756		673		711
Reconciliation to financial statements
	Corporate items, pensions and eliminations				(2,816	)		(3,021	)		(422	)⁽⁶⁾		(238	)⁽⁶⁾		10		61		31		19
	Other interest expense				—			—			—			—			—		—		—		—
	Gains on sales and dispositions of significant business interests				—			—			—			—			—		—		—		—
	Other assets related reconciling items				45,465			51,944			—			—			—		—		—		—

		Total Operations (for columns Group profit/Net capital employed, i.e. Income before income taxes/Total assets)			63,201			67,699			(569	)		1,362			1,619		817		704		730


				Total assets

Financing and Real Estate Groups
	Siemens Financial Services (SFS)				8,009			8,681			307			(84	)		56		39		55		60
	Siemens Real Estate (SRE)				3,696			4,090			80			97			71		57		47		51
	Eliminations				(501	)		(561	)		(37	)⁽⁶⁾		(34	)⁽⁶⁾		—		—		—		—

			Total Financing and Real Estate		11,204			12,210			350			(21	)		127		96		102		111

Eliminations, reclassifications and Corporate Treasury					2,815			(1,970	)		485	⁽⁶⁾		125	⁽⁶⁾		—		—		—		—

Siemens worldwide					77,220			77,939			266			1,466			1,746		913		806		841

(1)		Group profit of the Operations Groups is earnings before financing interest, certain pension costs, income taxes and certain one-time items, which in management’s view do not relate to the business performance of the Groups.
(2)		Net capital employed of the Operations Groups represents total assets less tax assets, certain accruals and non-interest bearing liabilities other than tax liabilities.
(3)		Intangible assets, property, plant and equipment, acquisitions, and investments.
(4)		Includes amortization and impairments of intangible assets, depreciation of property, plant and equipment, and write-downs of investments.
(5)		Other operations primarily refer to certain centrally-held equity investments and other operating activities not associated with a Group.
(6)		Includes (for “Eliminations” within Financing and Real Estate consists of) cash paid for income taxes according to the allocation of income taxes to Operations, Financing and Real Estate, and Eliminations, reclassifications and Corporate Treasury in the Consolidated Statements of Income.

SIEMENS AG

SEGMENT INFORMATION (unaudited)
As of and for the nine months ended June 30, 2003 and 2002 and as of September 30, 2002
(in millions of €)


														Intersegment
				New orders						External sales				sales						Total sales						Group profit⁽¹⁾

				2003			2002			2003		2002		2003			2002			2003			2002			2003			2002

Operations Groups
	Information and Communication Networks (ICN)				5,385			6,830			4,834		7,062		336			325			5,170			7,387			(423	)		(366	)
	Information and Communication Mobile (ICM)				7,122			9,002			7,239		8,258		106			106			7,345			8,364			131			72
	Siemens Business Services (SBS)				3,982			4,757			2,981		3,170		907			1,125			3,888			4,295			54			75
	Automation and Drives (A&D)				6,467			6,610			5,169		5,368		921			859			6,090			6,227			566			504
	Industrial Solutions and Services (I&S)				2,996			3,174			2,106		2,394		772			784			2,878			3,178			(24	)		(69	)
	Siemens Dematic (SD)				1,797			2,198			1,853		2,231		67			60			1,920			2,291			(40	)		35
	Siemens Building Technologies (SBT)				3,629			4,150			3,395		3,776		195			229			3,590			4,005			63			108
	Power Generation (PG)				6,079			9,146			4,993		7,117		13			31			5,006			7,148			950			1,228
	Power Transmission and Distribution (PTD)				2,788			3,635			2,342		2,823		175			186			2,517			3,009			142			93
	Transportation Systems (TS)				3,256			3,832			3,257		3,112		24			11			3,281			3,123			206			173
	Siemens VDO Automotive (SV)				6,408			6,463			6,401		6,458		7			5			6,408			6,463			303			80
	Medical Solutions (Med)				5,505			6,027			5,330		5,509		52			13			5,382			5,522			832			717
	Osram				3,154			3,310			3,120		3,257		34			53			3,154			3,310			305			270
	Other operations⁽⁵⁾				1,294			1,435			847		1,004		460			585			1,307			1,589			128			129

			Total Operations Groups		59,862			70,569			53,867		61,539		4,069			4,372			57,936			65,911			3,193			3,049
Reconciliation to financial statements
	Corporate items, pensions and eliminations				(5,012	)		(5,846	)		76		196		(3,962	)		(4,329	)		(3,886	)		(4,133	)		(1,256	)		(751	)
	Other interest expense				—			—			—		—		—			—			—			—			(37	)		(106	)
	Gains on sales and dispositions of significant business interests				—			—			—		—		—			—			—			—			—			936
	Other assets related reconciling items				—			—			—		—		—			—			—			—			—			—

		Total Operations (for columns Group profit/Net capital employed, i.e. Income before income taxes/Total assets)			54,850			64,723			53,943		61,735		107			43			54,050			61,778			1,900			3,128


																										Income before income taxes

Financing and Real Estate Groups
	Siemens Financial Services (SFS)				410			435			322		321		88			114			410			435			213			166
	Siemens Real Estate (SRE)				1,182			1,199			188		178		994			1,021			1,182			1,199			187			220
	Eliminations				—			—			—		—		(9	)		(6	)		(9	)		(6	)		—			—

			Total Financing and Real Estate		1,592			1,634			510		499		1,073			1,129			1,583			1,628			400			386

Eliminations, reclassifications and Corporate Treasury					2			497			2		492		(1,180	)		(1,172	)		(1,178	)		(680	)		144			(269	)

Siemens worldwide					56,444			66,854			54,455		62,726		—			—			54,455			62,726			2,444			3,245

[Additional columns below]

[Continued from above table, first column(s) repeated]


										Net cash from										Amortization,
				Net capital						operating and						Capital				depreciation and
				employed⁽²⁾						investing activities						spending⁽³⁾				impairments⁽⁴⁾

				6/30/03			9/30/02			2003			2002			2003		2002		2003		2002

Operations Groups
	Information and Communication Networks (ICN)				738			1,100			(58	)		158			131		318		346		339
	Information and Communication Mobile (ICM)				1,681			1,973			272			247			235		256		221		267
	Siemens Business Services (SBS)				502			264			(224	)		(1	)		120		152		185		207
	Automation and Drives (A&D)				1,952			2,197			753			614			153		158		161		172
	Industrial Solutions and Services (I&S)				222			315			(11	)		(210	)		25		44		37		40
	Siemens Dematic (SD)				1,191			975			(326	)		(125	)		30		53		41		47
	Siemens Building Technologies (SBT)				1,550			1,778			214			129			68		95		101		117
	Power Generation (PG)				1,047			(144	)		(218	)		905			627		176		113		111
	Power Transmission and Distribution (PTD)				836			928			246			16			43		72		48		54
	Transportation Systems (TS)				(30	)		(741	)		(537	)		269			69		91		43		40
	Siemens VDO Automotive (SV)				3,912			3,746			64			263			405		346		292		293
	Medical Solutions (Med)				3,355			3,414			406			598			230		226		157		140
	Osram				2,124			2,436			407			136			172		236		198		216
	Other operations⁽⁵⁾				1,472			535			(529	)		33			494		40		42		35

			Total Operations Groups		20,552			18,776			459			3,032			2,802		2,263		1,985		2,078
Reconciliation to financial statements
	Corporate items, pensions and eliminations				(2,816	)		(3,021	)		(1,409	)⁽⁶⁾		486	⁽⁶⁾		3		3,727		63		62
	Other interest expense				—			—			—			—			—		—		—		—
	Gains on sales and dispositions of significant business interests				—			—			—			—			—		—		—		—
	Other assets related reconciling items				45,465			51,944			—			—			—		—		—		—

		Total Operations (for columns Group profit/Net capital employed, i.e. Income before income taxes/Total assets)			63,201			67,699			(950	)		3,518			2,805		5,990		2,048		2,140


				Total assets

Financing and Real Estate Groups
	Siemens Financial Services (SFS)				8,009			8,681			300			256			137		190		163		182
	Siemens Real Estate (SRE)				3,696			4,090			214			235			138		183		145		151
	Eliminations				(501	)		(561	)		(111	)⁽⁶⁾		(108	)⁽⁶⁾		—		—		—		—

			Total Financing and Real Estate		11,204			12,210			403			383			275		373		308		333

Eliminations, reclassifications and Corporate Treasury					2,815			(1,970	)		1,074	⁽⁶⁾		(695	)⁽⁶⁾		—		214		—		209

Siemens worldwide					77,220			77,939			527			3,206			3,080		6,577		2,356		2,682

(1)		Group profit of the Operations Groups is earnings before financing interest, certain pension costs, income taxes and certain one-time items, which in management’s view do not relate to the business performance of the Groups.
(2)		Net capital employed of the Operations Groups represents total assets less tax assets, certain accruals and non-interest bearing liabilities other than tax liabilities.
(3)		Intangible assets, property, plant and equipment, acquisitions, and investments.
(4)		Includes amortization and impairments of intangible assets, depreciation of property, plant and equipment, and write-downs of investments.
(5)		Other operations primarily refer to certain centrally-held equity investments and other operating activities not associated with a Group.
(6)		Includes (for “Eliminations” within Financing and Real Estate consists of) cash paid for income taxes according to the allocation of income taxes to Operations, Financing and Real Estate, and Eliminations, reclassifications and Corporate Treasury in the Consolidated Statements of Income.

SIEMENS AG

CONSOLIDATED STATEMENTS OF INCOME (unaudited)
For the three months ended June 30, 2003 and 2002
(in millions of €, per share amounts in €)


									Eliminations,
									reclassifications and												Financing and
			Siemens worldwide						Corporate Treasury						Operations						Real Estate

			2003			2002			2003			2002			2003			2002			2003			2002

Net sales				17,380			20,482			(392	)		(377	)		17,249			20,308			523			551
Cost of sales				(12,274	)		(14,669	)		393			377			(12,258	)		(14,629	)		(409	)		(417	)

Gross profit on sales				5,106			5,813			1			—			4,991			5,679			114			134
Research and development expenses				(1,248	)		(1,425	)		—			—			(1,248	)		(1,425	)		—			—
Marketing, selling and general administrative expenses				(3,190	)		(3,610	)		2			—			(3,119	)		(3,524	)		(73	)		(86	)
Other operating income (expense), net (therein gain on issuance of subsidiary and associated company stock €4, fiscal 2002)				124			58			(16	)		(22	)		81			43			59			37
Income from investments in other companies, net				16			87			—			—			(3	)		48			19			39
Income (expense) from financial assets and marketable securities, net				(63	)		22			(3	)		(21	)		(62	)		47			2			(4	)
Interest income of Operations, net				6			24			—			—			6			24			—			—
Other interest income (expense), net				75			49			59			47			(11	)		(14	)		27			16

		Income before income taxes		826			1,018			43			4			635			878			148			136
Income taxes				(183	)		(258	)		(9	)		3			(140	)		(228	)		(34	)		(33	)
Minority interest				(11	)		(35	)		—			—			(11	)		(35	)		—			—

		Income before cumulative effect of change in accounting principle		632			725			34			7			484			615			114			103
Cumulative effect of change in accounting principle, net of income taxes				—			—			—			—			—			—			—			—
		Net income		632			725			34			7			484			615			114			103

Basic earnings per share
	Income before cumulative effect of change in accounting principle			0.71			0.81
	Cumulative effect of change in accounting principle, net of income taxes			—			—

	Net income			0.71			0.81

Diluted earnings per share
	Income before cumulative effect of change in accounting principle			0.71			0.81
	Cumulative effect of change in accounting principle, net of income taxes			—			—

	Net income			0.71			0.81

SIEMENS AG

CONSOLIDATED STATEMENTS OF INCOME (unaudited)
For the nine months ended June 30, 2003 and 2002
(in millions of €, per share amounts in €)


									Eliminations,
									reclassifications and												Financing and
			Siemens worldwide						Corporate Treasury⁽²⁾						Operations						Real Estate

			2003			2002			2003			2002			2003			2002			2003			2002

Net sales				54,455			62,726			(1,178	)		(680	)		54,050			61,778			1,583			1,628
Cost of sales				(38,899	)		(45,280	)		1,180			604			(38,872	)		(44,651	)		(1,207	)		(1,233	)

Gross profit on sales				15,556			17,446			2			(76	)		15,178			17,127			376			395
Research and development expenses				(3,821	)		(4,398	)		—			(168	)		(3,821	)		(4,230	)		—			—
Marketing, selling and general administrative expenses				(9,930	)		(11,177	)		2			(88	)		(9,712	)		(10,876	)		(220	)		(213	)
Other operating income (expense), net (therein gain on issuance of subsidiary and associated company stock €4, fiscal 2002)				408			998			(53	)		864			347			16			114			118
Income (loss) from investments in other companies, net				44			162			—			(16	)		(18	)		136			62			42
Income (expense) from financial assets and marketable securities, net				(26	)		68			39			29			(64	)		52			(1	)		(13	)
Interest income of Operations, net				27			73			—			—			27			73			—			—
Other interest income (expense), net				186			73			154			122			(37	)		(106	)		69			57
Gains on sales and dispositions of significant business interests				—			—			—			(936	)		—			936			—			—

		Income (loss) before income taxes		2,444			3,245			144			(269	)		1,900			3,128			400			386
Income taxes⁽¹⁾				(701	)		(708	)		(41	)		59			(545	)		(683	)		(115	)		(84	)
Minority interest				(58	)		7			—			2			(58	)		5			—			—

		Income (loss) before cumulative effect of change in accounting principle		1,685			2,544			103			(208	)		1,297			2,450			285			302
Cumulative effect of change in accounting principle, net of income taxes				36			—			—			—			39			—			(3	)		—
		Net income (loss)		1,721			2,544			103			(208	)		1,336			2,450			282			302

Basic earnings per share
	Income before cumulative effect of change in accounting principle			1.89			2.86
	Cumulative effect of change in accounting principle, net of income taxes			0.04			—

	Net income			1.93			2.86

Diluted earnings per share
	Income before cumulative effect of change in accounting principle			1.89			2.86
	Cumulative effect of change in accounting principle, net of income taxes			0.04			—

	Net income			1.93			2.86

(1)		The income taxes of Eliminations, reclassifications and Corporate Treasury, Operations, and Financing and Real Estate are based on the consolidated effective corporate tax rate applied to income before income taxes.

(2)		As of December 5, 2001, Siemens deconsolidated Infineon. The results of operations from Infineon for the first two months of the fiscal year 2002 period are included in Eliminations, reclassifications and Corporate Treasury. As of December 5, 2001, the share in earnings (loss) from Infineon is included in “Income (loss) from investments in other companies, net” in Operations.

SIEMENS AG

CONSOLIDATED STATEMENTS OF CASH FLOW (unaudited)
For the nine months ended June 30, 2003 and 2002
(in millions of €)


											Eliminations,
											reclassifications and												Financing and
					Siemens worldwide						Corporate Treasury						Operations						Real Estate

					2003			2002			2003			2002			2003			2002			2003			2002

Cash flows from operating activities
	Net income (loss)					1,721			2,544			103			(208	)		1,336			2,450			282			302
	Adjustments to reconcile net income to cash provided
		Minority interest				58			(7	)		—			(2	)		58			(5	)		—			—
		Amortization, depreciation and impairments				2,356			2,682			—			209			2,048			2,140			308			333
		Deferred taxes				10			(204	)		—			(187	)		12			7			(2	)		(24	)
		Gains on sales and disposals of businesses and property, plant and equipment, net, and gain from issuance of subsidiary and associated company stock				(188	)		(1,106	)		—			(936	)		(125	)		(101	)		(63	)		(69	)
		Losses (gains) on sales of investments, net				7			(148	)		—			7			7			(155	)		—			—
		Gains on sales and dispositions of significant business interests				—			—			—			936			—			(936	)		—			—
		Losses (gains) on sales and impairments of marketable securities, net				25			(10	)		9			(2	)		15			(11	)		1			3
		Loss (income) from equity investees, net of dividends received				59			90			—			17			103			105			(44	)		(32	)
		Change in current assets and liabilities
			(Increase) decrease in inventories, net			(874	)		16			—			86			(932	)		(108	)		58			38
			(Increase) decrease in accounts receivable, net			1,303			1,966			252			555			1,049			1,371			2			40
			Increase (decrease) in outstanding balance of receivables sold			(550	)		(462	)		(259	)		(462	)		(291	)		—			—			—
			(Increase) decrease in other current assets			823			(80	)		593			(711	)		270			656			(40	)		(25	)
			Increase (decrease) in accounts payable			(873	)		(1,309	)		(9	)		(249	)		(892	)		(1,062	)		28			2
			Increase (decrease) in accrued liabilities			124			(47	)		—			43			124			(80	)		—			(10	)
			Increase (decrease) in other current liabilities			(870	)		(442	)		521			18			(1,225	)		(503	)		(166	)		43
		Supplemental contributions to pension trusts				(442	)		—			—			—			(442	)		—			—			—
		Change in other assets and liabilities				621			864			180			442			417			434			24			(12	)

				Net cash provided by (used in) operating activities		3,310			4,347			1,390			(444	)		1,532			4,202			388			589
Cash flows from investing activities
	Additions to intangible assets and property, plant and equipment					(1,888	)		(2,606	)		—			(149	)		(1,619	)		(2,089	)		(269	)		(368	)
	Acquisitions, net of cash acquired					(547	)		(3,710	)		—			—			(547	)		(3,710	)		—			—
	Purchases of investments					(645	)		(261	)		—			(65	)		(639	)		(191	)		(6	)		(5	)
	Purchases of marketable securities					(203	)		(88	)		(92	)		(36	)		(109	)		(11	)		(2	)		(41	)
	Increase in receivables from financing activities					(144	)		(43	)		(508	)		(506	)		—			—			364			463
	Increase (decrease) in outstanding balance of receivables sold by SFS					—			—			259			462			—			—			(259	)		(462	)
	Proceeds from sales of long-term investments,
		intangibles and property, plant and equipment				499			741			—			—			313			538			186			203
	Proceeds from sales and dispositions of businesses					96			4,720			—			—			96			4,720			—			—
	Proceeds from sales of marketable securities					49			106			25			43			23			59			1			4

				Net cash (used in) provided by investing activities		(2,783	)		(1,141	)		(316	)		(251	)		(2,482	)		(684	)		15			(206	)
Cash flows from financing activities
	Proceeds from issuance of capital stock					—			156			—			—			—			156			—			—
	Purchase of common stock of Company					—			(152	)		—			—			—			(152	)		—			—
	Proceeds from issuance of treasury shares					4			81			—			—			4			81			—			—
	Proceeds from issuance of debt					2,702			256			2,702			256			—			—			—			—
	Repayment of debt					(742	)		(809	)		(742	)		(809	)		—			—			—			—
	Change in short-term debt					(171	)		(3	)		(544	)		85			433			(53	)		(60	)		(35	)
	Change in restricted cash					—			(2	)		—			(2	)		—			—			—			—
	Dividends paid					(888	)		(888	)		—			—			(888	)		(888	)		—			—
	Dividends paid to minority shareholders					(82	)		(95	)		—			—			(82	)		(95	)		—			—
	Intracompany financing					—			—			(978	)		2,742			1,316			(2,401	)		(338	)		(341	)

				Net cash provided by (used in) financing activities		823			(1,456	)		438			2,272			783			(3,352	)		(398	)		(376	)
Effect of deconsolidation of Infineon on cash and cash equivalents						—			(383	)		—			(383	)		—			—			—			—
Effect of exchange rates on cash and cash equivalents						(309	)		(121	)		(245	)		(80	)		(62	)		(39	)		(2	)		(2	)
Net increase (decrease) in cash and cash equivalents						1,041			1,246			1,267			1,114			(229	)		127			3			5
Cash and cash equivalents at beginning of period						11,196			7,802			10,269			6,860			873			907			54			35

Cash and cash equivalents at end of period						12,237			9,048			11,536			7,974			644			1,034			57			40

SIEMENS AG

CONSOLIDATED BALANCE SHEETS (unaudited)
As of June 30, 2003 and September 30, 2002
(in millions of €)


									Eliminations,
									reclassifications and										Financing and Real
			Siemens worldwide						Corporate Treasury						Operations				Estate

			6/30/03			9/30/02			6/30/03			9/30/02			6/30/03		9/30/02		6/30/03		9/30/02

ASSETS
Current assets
	Cash and cash equivalents			12,237			11,196			11,536			10,269			644		873		57		54
	Marketable securities			805			399			101			25			684		356		20		18
	Accounts receivable, net			13,886			15,230			(10	)		(7	)		10,725		12,058		3,171		3,179
	Intracompany receivables			—			—			(9,973	)		(13,284	)		9,883		13,209		90		75
	Inventories, net			11,056			10,672			(5	)		(5	)		11,039		10,592		22		85
	Deferred income taxes			1,236			1,212			197			64			1,034		1,143		5		5
	Other current assets			5,437			5,353			1,050			1,028			3,424		3,306		963		1,019

		Total current assets		44,657			44,062			2,896			(1,910	)		37,433		41,537		4,328		4,435

Long-term investments				5,560			5,092			—			2			5,239		4,797		321		293
Goodwill				6,140			6,459			—			—			6,059		6,369		81		90
Other intangible assets, net				2,349			2,384			—			—			2,328		2,362		21		22
Property, plant and equipment, net				10,811			11,742			1			2			7,130		7,628		3,680		4,112
Deferred income taxes				3,497			3,686			807			764			2,534		2,771		156		151
Other assets				4,206			4,514			98			103			1,491		1,304		2,617		3,107
Other intracompany receivables				—			—			(987	)		(931	)		987		931		—		—

		Total assets		77,220			77,939			2,815			(1,970	)		63,201		67,699		11,204		12,210

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
	Short-term debt and current maturities of long-term debt			1,974			2,103			398			1,143			1,456		785		120		175
	Accounts payable			7,543			8,649			(10	)		6			7,337		8,453		216		190
	Intracompany liabilities			—			—			(6,906	)		(7,776	)		1,669		1,799		5,237		5,977
	Accrued liabilities			9,568			9,608			18			18			9,274		9,445		276		145
	Deferred income taxes			670			661			(237	)		(206	)		679		647		228		220
	Other current liabilities			11,981			13,691			373			375			11,313		12,853		295		463

		Total current liabilities		31,736			34,712			(6,364	)		(6,440	)		31,728		33,982		6,372		7,170

Long-term debt				12,448			10,243			11,317			6,833			695		2,974		436		436
Pension plans and similar commitments				5,130			5,326			—			—			5,102		5,299		28		27
Deferred income taxes				211			195			14			(50	)		88		119		109		126
Other accruals and provisions				3,212			3,401			24			28			2,879		3,068		309		305
Other intracompany liabilities				—			—			(2,176	)		(2,341	)		226		45		1,950		2,296

				52,737			53,877			2,815			(1,970	)		40,718		45,487		9,204		10,360

Minority interests				535			541			—			—			535		541		—		—
Shareholders’ equity
	Common stock, no par value
		Authorized: 1,129,351,214 and 1,145,917,335 shares, respectively
		Issued: 890,474,546 and 890,374,001 shares, respectively		2,671			2,671
	Additional paid-in capital			5,055			5,053
	Retained earnings			22,304			21,471
	Accumulated other comprehensive income (loss)			(6,082	)		(5,670	)
	Treasury stock, at cost. 1,133 and 49,864 shares, respectively			—			(4	)

		Total shareholders’ equity		23,948			23,521			—			—			21,948		21,671		2,000		1,850

		Total liabilities and shareholders’ equity		77,220			77,939			2,815			(1,970	)		63,201		67,699		11,204		12,210

Foreign Exchange Rate Impacts (USD) on Siemens (Q3/2003)

→		Currency Translation Exposure

		Translation exposure arises from translating the currencies which affect our balance sheet and income statement amounts into the Euro, our reporting currency. In relation to the U.S. dollar (USD), the impact of currency translation on worldwide Group Profit margins has been negligible, or slightly positive, with the exception of PG. This results from the fact that the Group Profit margins of our U.S. businesses have generally been lower than the overall Group Profit margin for the Groups on a worldwide basis.

→		Transaction Exposure

		Transaction exposure relates to the actual impact on our operations resulting from fluctuations in currencies other than the local currency of an individual operation. In relation to the USD, this effect has also typically been negligible in that USD denominated sales are largely offset by production and worldwide procurement activities also denominated in USD, creating a so-called “natural hedge”. In addition to the natural hedge, we enter into foreign exchange contracts to cover at least 75% of total foreign currency exposure.

→		Foreign Currency Management

		In addition to operating cash flows, financing of our U.S. activities typically occurs in Euros. The foreign currency exposure resulting from this financing is covered by forward exchange contracts and does not materially affect consolidated earnings. However, future cash flows vary (up to now, the effect has been positive due to the falling U.S. dollar) but may balance out over the longer term as they reflect currency exchange rate development.

→		Economic Risk

		Competitors which operate primarily on a USD basis may use this currency-related advantage in establishing pricing levels in their markets. This risk cannot be managed through financial instruments and results in a vulnerability for certain of our divisions which currently do not have a completely diversified business structure.

Foreign Exchange Rate Impacts (USD) on Siemens (Q3/2003)


	Translation¹⁾ (Impact of declining USD on Group profit margin)		Transaction-Exposure²⁾ (before hedging)

ICN		0	<
ICM		0	~
SBS		0	~
A&D		+	>
I&S		0	~
SD		0	~
SBT		0	~
PG		–	>
PTD		0	>
TS		0	~
SV		0	~
Med		+	>
Osram		+	~

“Value added” refers to all production activities and services, including selling and R&D activities. For the purposes of this analysis, these activities have a value measured by the cost of production or services in terms of wages, salaries, other costs and expenses.

¹⁾		A change of € 0.10 Cent in the USD exchange rate has a maximum effect on Group Profit margin of 0.5% points

²⁾		Sales minus value added and purchased goods & services (the maximum difference amounted to 10%-points at ICN, A&D, PG and Med)


0		*negligible*

–		*slightly negative*

+		*slightly positive*

~		*Sales equals value added and purchased goods & services (+/- equal value)*

<		*Sales less than value added and purchased goods & services*

>		*Sales greater than value added and purchased goods & services*

(SIEMENS LOGO)

Terminology update

As a result of the implementation of the new rule Conditions for Use of Non-GAAP Financial Measures of the U.S. Securities and Exchange Commission (SEC), beginning in the second quarter Siemens changed the terminology and definition of certain terms used in its financial reporting especially relating to its Groups.

Summarized information specifying the changes is provided in the table below:


New terminology/definition		Previous terminology/definition

Group		Segment/group

	Designates a reportable segment.		Previously both terms were used.

Group profit		EBIT

	Measure of individual segment profit or loss.

	Definition remains unchanged: “Earnings before financing interest, certain pension costs, income taxes and certain one-time items, which do not relate to the business performance of the Groups.”

Other operations

	New line item within the Segment information table which primarily refers to certain centrally-held equity investments (such as BSH Bosch und Siemens Hausgeräte) and other operating activities not associated with a Group.		No comparable previous line item. “Other operations” was part of the former line item “Corporate, eliminations”.

Group profit from Operations		EBIT from Operations

	Total of the individual Groups’ profit including “Other operations”.		No longer acceptable Non-GAAP Siemens measure under new SEC rules.

	Definition changed. The former line item “Corporate, eliminations” is now separated into “Other operations” which is included in Group profit from Operations, and “Corporate items, pensions and eliminations” which is included in “Reconciliation to financial statements”.		EBIT from Operations had been the total of the segments’ EBIT and “Corporate, eliminations”. EBIT from Operations can be calculated as total of Group profit from Operations plus “Corporate items, pensions and eliminations”⁽¹⁾.

Corporate items, pensions and eliminations

	New element of the line item “Reconciliation to financial statements” within the Segment information table.		No comparable previous line item. “Corporate items, pensions and eliminations” was part of the former line item “Corporate, eliminations”⁽²⁾.

	Includes all other items of the former “Corporate, eliminations” which refer to centrally managed items unrelated to operating activities. These comprise, among others, corporate charges such as personnel cost, corporate projects, certain non-allocated pension costs and corporate-related derivative activities. Also included are certain centrally-held investments, primarily the equity investment in Infineon which is not considered under an operating perspective since Siemens intends to divest its remaining interest in Infineon over time.



(1)	Reconciliation from “Group profit from Operations” to “EBIT from Operations”:	(2)	Reconciliation from “Corporate items, pensions and eliminations” to “Corporate, eliminations”:


*(in millions of euros)*	3^rd quarter						first nine months						*(in millions of euros)*	3^rd quarter						first nine months
	2003			2002			2003			2002				2003			2002			2003			2002

Group profit from Operations		1,023			1,098			3,193			3,049		Corporate items, pensions and eliminations		(377	)		(206	)		(1,256	)		(751	)
Corporate items, pensions and eliminations		(377	)		(206	)		(1,256	)		(751	)	Other operations		6			(3	)		128			129

EBIT from Operations		646			892			1,937			2,298		Corporate, eliminations		(371	)		(209	)		(1,128	)		(622	)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


		SIEMENS AKTIENGESELLSCHAFT

Date: July 24, 2003		/s/ CHARLES HERLINGER Name: Charles Herlinger Title: Vice President and Corporate Controller

		/s/ DANIEL SATTERFIELD Name: Daniel Satterfield Title: Director

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