Siemens is leaving Russia because of the war in Ukraine after being active in that country for almost 170 years. The sanctions against Russia already caused the German industrial group a financial blow of about 600 million euros last quarter.
After the war broke out, Siemens stopped all new contracts and international deliveries to Russia and Belarus. In combination with the sanctions, this put a lot of pressure on the results. The branch dealing with railways, trains and maintenance activities was particularly affected by the situation.
According to CEO Roland Busch, it was not an easy decision to turn his back on Russia. The company has about 3000 employees and has a long history in the country. In the nineteenth century, Carl von Siemens, brother of the company’s founder, even settled permanently in Russia. The Russian Tsar also ennobled him.
It is not yet entirely clear how the departure from Russia will take shape. However, according to Busch, Siemens is opting for an “orderly process” when phasing out the activities. This process is also said to have already started. “We are evaluating the impact on our people, and we will continue to support them as best we can.”
Partly due to the impact of the conflict, Siemens’ profits halved last quarter to 1.2 billion euros. But in the comparable period last year, the group still benefited strongly from the proceeds from the sale of a part.
However, Siemens has also been experiencing strong growth recently. Good business is being done especially in the digital field; for example, with software to automate factory processes. Total turnover increased by 16 percent to approximately 17 billion euros. Aided by the economic recovery from the corona crisis, the order book is almost a third more full than a year ago.