Europe's biggest engineering conglomerate Siemens posted an unexpectedly sharp fall in core profits and saw a six-quarter streak of rising orders come to an end as the Eurozone's debt woes hit corporate spending and investment.
Chief executive Peter Loescher warned that 2012 would be a difficult year for Germany's largest company by market capitalisation, but stuck with a forecast for flat net income from continuing operations.
"For us 2012 will not be easy," he said. "The golden days are gone."
The maker of trains, turbines, hearing aids and lightbulbs saw new orders shrink for the first time since the January-March quarter of 2010.
Siemens is a bellwether not only for the euro zone's biggest economy but also for the region, which is expected to fall into recession in the next six months as the festering debt crisis keeps a lid on investment expectations.
Loescher said Siemens would be operating in a more difficult climate but noted the company's short-cycle businesses - which react swiftly to economic swings - were holding up.
"We expect the economic environment to remain difficult in the second quarter and to gradually improve after that, " he said.
City A.M. Reporter