GERMANY – Industrial group Siemens says its main pension schemes returned 12% on an annualised basis – although they are still underfunded by more than three billion euros.

“The return on plan assets during the first six months amounted to 1.012 billion euros,” the company said in its first-half report. “This represents a 12.0% return on an annualized basis, well above the expected annualized return of 6.7%.”

It made a supplemental pension contribution totalling 1.255 billion euros in the first half of fiscal 2004, up from 442 million euros in the same period in 2003.

In January Siemens said the plans returned 14% on an annualised basis in 2003. Its pension assets were worth 17.9 billion euros at the end of 2003.

It said the funding status of its principal pension plans as at March 31 2004 had “improved significantly compared to the end of the prior fiscal year” – with an underfunding of around 3.1 billion euros against underfunding of around five billion euros at the end of September last year.

It added that the plans’ projected benefit obligation rose by some 300 million euros during the first six months. This was “due to the net of pension service and interest costs less benefits paid”.