ABB orders beat forecasts, currency hits core profit

Wednesday, Apr 29, 2015

Swiss engineering group ABB said it doubled large orders and kept smaller orders steady in the first quarter, lifting its total order intake by a better-than-expected 15 percent.

The like-for-like rise to $10.4 billion - compared with a Reuters poll average of $10.2 billion - excludes currency translation effects. ABB reports results in U.S. dollars but books a large part of sales in other currencies like the euro.

Translation effects pushed its operational earnings before interest, tax and amortisation (EBITA) down 9 percent to $949 million. On a like-for-like basis, operational EBITA rose 5 percent, ABB said on Wednesday.

Net profit rose 4 percent to $564 million, beating the Reuters poll average of $550 million.

ABB, which makes products such as industrial robots and power grid transformers, said its combined power and automation offering helped it win key projects and increase orders in its three largest countries - the United States, China and Germany.

But low oil prices caused a reduction in discretionary spending by oil and gas customers, it said.

"We are driving cost out and implementing additional restructuring to address market uncertainties in the quarters ahead," Chief Executive Ulrich Spiesshofer said in a statement.

ABB said the long-term demand outlook in its three top sectors - utilities, industry and transport and infrastructure - was positive but its results would continue to be influenced by oil prices, currency effects and macroeconomic uncertainty.