ABB sees first half hit to profits

July 26, 2019 //By Nick Flaherty
Swiss power specialist ABB has seen a boost from its US operation in the last six months but has taken a hit in selling off its solar inverter business
Swiss power giant ABB has seen a boost from its activities in the Americas in the last six months but has taken a hit to its profits from selling off its solar inverter business

ABB has been shifting from power generation equipment to electrification, with a new structure of four divisions coming in to effect in April this year. 

“Overall total orders and revenues continued to grow, led by Electrification and Motion while Robotics and Discrete Automation in particular felt the downturn in automotive and machine building,” said Timo Ihamuotila, CFO of ABB. “At the same time, we are making good progress with the carve-out of our Power Grids business, the integration of GEIS and the roll-out of our ABB-OS operating model, which all are planned to make ABB more profitable.”

Revenue was up 6 percent for the first half of 2019 to $13.172bn with profits down 47 percent at $1.33bn. Overall, orders were up 2 per cent to over $14bn. 

The company took a $455m charge on the sale of its solar inverter business to FIMER in Italy earlier this month, which is expected to close in the first quarter of 2020. The solar inverter business has approximately 800 employees in more than 30 countries, with manufacturing and R&D sites located in Italy, India and Finland and turn over of $290m. It includes the solar inverter business from Power-One which was acquired by ABB’s Discrete Automation and Motion division in 2013. The sell off will make the electrification business more proftiable says ABB.

“ABB continued to generate top-line momentum during the second quarter despite macroeconomic headwinds and geopolitical uncertainty,” said Peter Voser, Chairman and CEO of ABB. “Going forward we will drive long-term growth across our businesses, while staying focused on costs and portfolio management.”

Orders from Europe were stable (3 percent lower in US dollars). Strong growth in France, the Netherlands and Spain, plus robust growth from Germany was more than offset by lower order levels from Italy, the UK, Finland and Sweden. In Germany, orders were up 1 percent (2 percent lower in US dollars). 

Boost from the Americas

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