Siemens AG cuts annual profit forecast to €5.4 billion

Siemens AG cut its annual profit forecast for the third time in five years with delays in linking off-shore wind parks to Europe's power grid hindering chief executive officer Peter Loescher's renewable energy initiatives.

Siemens now expects net income from continuing operations of €5.2 billion to €5.4 billion in the year through September, down from a €6 billion target, according to the Munich-based company.

Peter Loescher, chief executive has found the going to his goal of generating €40 billion in two years from products related to the environment and energy in sales tough due to several setbacks.

Siemens's transmissions unit took a hit of €481 million on extra costs this year due to delays in hooking up marine wind farms. According to Loescher, the ''majority'' of charges had already been booked.

Siemens was up much as 2.2 per cent to €71.33 and was trading 1 per cent higher in Frankfurt, valuing the company at €64.5 billion. The increase compares with a 1.3 per cent gain in Germany's benchmark DAX Index.

Orders were down 13 per cent in three months through March, but Siemens said they are expected to revive in the second fiscal half as against the first, Loescher said today on a conference call.