Tech

ABB continues growth momentum as it looks forward to Q3

"In Q2, ABB continued to build its growth momentum as our targeted initiatives are delivering. Order growth was broad-based and across all regions,” said ABB CEO Ulrich Spiesshofer. "Our industry-leading digital offering, ABB Ability, is taking off and starting to contribute to growth”

"Operational performance in the Power Grids and Industrial Automation divisions was solid in the quarter. Electrification Products and Robotics and Motion improved margins sequentially, but were not able to fully compensate commodity price headwinds and overcapacity during the quarter,” he said. "While we are pleased with the growth momentum, especially the double-digit order growth in Robotics and Motion, we remain firmly focused on further improving operational execution and our cost base.”

"The successful completion of the B&R acquisition and the handover of our last legacy off-shore wind project, Dolwin 2, are solid examples of the disciplined execution of our Next Level strategy.”

Asia, Middle East and Africa (AMEA) grew due to increased demand in industry, transport, and infrastructure for energy-efficient and automation solutions. Utilities made selective investments in the quarter. Total orders increased 2 percent (2 percent lower in US dollars) driven primarily by substantial growth in India, Saudi Arabia and South Africa.

ABB continued the implementation of its Next Level strategy during the quarter by further shifting its center of gravity to higher growth segments, strengthening its competitiveness and de-risking the portfolio.

On July 6, ABB announced the completion of its acquisition of B&R (Bernecker + Rainer Industrie-Elektronik GmbH), the largest independent provider focused on product- and software-based, open-architecture solutions for machine and factory automation worldwide. This acquisition closes ABB’s historic gap in machine and factory automation and will create a uniquely comprehensive automation portfolio for customers globally. This all-cash acquisition is expected to be EPS-accretive in the first year.

On July 3, ABB announced that it had agreed to acquire the mission-critical communication network business from the KEYMILE Group to strengthen its portfolio and further enhance ABB Ability. It will add reliable communications technologies that are essential to maintain today’s dynamic and complex digital electrical grids. The acquisition will bring with it products, software and service solutions, as well as research and development expertise. It is expected to close during the third quarter of 2017.

ABB continues to build on its existing momentum and is further accelerating its operational performance.

Macroeconomic and geopolitical developments are signaling a mixed picture with continued uncertainty. Some macroeconomic signs remain positive in the United States and growth in China is expected to continue. The overall global market remains impacted by modest growth and increased uncertainties, e.g., Brexit in Europe and geopolitical tensions in various parts of the world. Oil prices and foreign exchange translation effects are expected to continue to influence the company’s results. With this and the ongoing transformation of ABB, we expect 2017 to be a transitional year.

The attractive long-term demand outlook in ABB’s three major customer sectors — utilities, industry and transport & infrastructure — is driven by the Energy and Fourth Industrial Revolutions.

ABB is well-positioned to tap into these opportunities for long-term profitable growth with its strong market presence, broad geographic and business scope, technology leadership and financial strength.