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| Siemens CEO Peter Löscher |
With shares in the tank and a less-than-rosy outlook for the year, Siemens ($SI) is showing CEO Peter Löscher the door.
In an over-the-weekend news release, benignly billed as an "extension to the agenda" of Wednesday's board meeting, Siemens said it would decide on Löscher's ouster and name his successor, and many expect CFO Joe Kaeser to assume the seat.
On Friday, the German giant revealed that it no longer expected to meet the 12% profit margin it initially expected for fiscal 2013, sending its shares down about 7%, casting a shadow over the company's upcoming earnings report and, judging by the board's reaction, marking the last straw for Löscher.
Löscher took the reins in 2007, promising to drive profitability by simplifying the company's structure. But, despite unit sales, spin-outs and ongoing cutbacks, Siemens has struggled over the past year, and its sprawling medical business, often a sole bright spot, hasn't exactly blown any doors off.
Siemens Healthcare grossed $17.7 billion in revenue last year, a slight increase over 2011 led by an expanding share of the diagnostics market but driven down by pricing pressures for in-hospital devices.
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| Siemens CFO Joe Kaeser |
Under Löscher's tenure, Siemens Healthcare instituted Agenda 2013, a two-year effort to trim extraneous costs and expand its presence in med tech. So far, that has meant layoffs around the world, a realignment of its radiation therapy unit and a focus on developing diagnostics, leading to partnerships with Eli Lilly ($LLY) and a newfound focus on personalized medicine technology.
But, while that system worked in Siemens' still-profitable medical arm, many of Löscher's high-dollar gambits in transportation and energy fell flat, The Wall Street Journal notes.
In May, the CEO held that despite mounting economic trouble in Europe and abroad, Siemens would reach its previously announced profit goals. Now, with that promise nixed, Löscher is on the way out.
In 2012, Löscher hauled in $10.1 million in total compensation, and, factoring in a termination fee and pension compensation, he'll have pulled down about $100 million in his 6 years at Siemens, Bloomberg notes.
Siemens is scheduled to release its fiscal third quarter report on Thursday.
Special Report: Peter Löscher - 2012's 10 highest-paid Med Tech CEOs
- read Siemens' statement
- check out the WSJ story (sub. req.)
- get more from Bloomberg