First amongst its peers to give a forecast for the coming year, Siemens predicted moderate sales growth, faster growth in orders and a double-digit rise in comparable earnings per share helped by more cost cuts in corporate areas like headquarters.

"We must reverse the trend of declining volumes seen in past years and increase them again. This turnaround is a key task for us in fiscal 2016, although the slowing of the global economy certainly is no help here," Chief Executive Joe Kaeser said.

The trains-to-turbines group also reported strong orders for its fourth quarter ended Sept. 30 on Thursday, which included the first tranche of a record 8 billion-euro (5.6 billion pounds) power order from Egypt.

A better than expected profit from its industrial business units helped it hit its full-year margin target, which came in at 10.1 percent, still well below that of arch-rival General Electric but comparable with Swiss group ABB.

Siemens also announced a new share buyback programme of up to 3 billion euros ($3.2 billion) over three years and raised its dividend to 3.50 euros from 3.30 euros per share for 2015.

The shares were up 3.4 percent at 95.32 euros by 1211 GMT, and were the top gainers in a 0.5 percent-weaker German blue-chip index.

"Post today's guidance, we believe there could be room for consensus upgrades over the course of the next 12 months if macro would be stable," DZ Bank analyst Alexander Hauenstein said in a research note. He has a "buy" rating on the stock.

In the fourth quarter, Siemens' industrial profit rose 9 percent to 2.46 billion euros, helped by improvements in energy management, wind power and renewables, healthcare and transport, beating the average forecast in a Reuters poll.

OIL PRICE RISK

Since taking over as CEO two years ago, former finance chief Kaeser has set out to reshape Siemens to make it more profitable and less cumbersome, while also battling a slump in its gas turbines business in Europe due to a switch to renewable energy.

In the past year he has sold Siemens' hearing-aids business and its stake in household appliances maker BSH for a total of 3 billion euros but also bought U.S. oil and gas equipment specialist Dresser-Rand for $7.8 billion.

Kaeser boasted that Siemens was unusual among its peers in having stuck to its forecasts over the course of the past year and told reporters the "moderate" sales growth Siemens was forecasting for the current year meant up to 5 percent.

Siemens maintained its industrial profit margin target of 10-11 percent, and said basic earnings per share should rise by at least 14 percent on a comparable basis to 5.90 to 6.20 euros.

Kaeser said Siemens' outlook anticipated a pick-up in the second half of the year in markets for its high-margin, short-cycle businesses - such as automation and building technology.

Siemens said new orders at Dresser-Rand were stabilising but would still come in below sales in the current year.

Global oil prices have more than halved since Siemens agreed to buy Dresser-Rand, causing customers to slash around $200 billion worth of projects.

The business reported a profit margin of 6.5 percent in the fourth quarter, its first as part of Siemens.

(Additional reporting by Karolin Schaps in Frankfurt; Editing by Keith Weir and Greg Mahlich)

By Georgina Prodhan