ABB: progress in challenging markets

Zurich, Switzerland, April 20, 2016: First-quarter highlights

• Profitability and cash flow up through execution of Next Level strategy
• Base orders steady[1,2] total orders -7% reflect challenging Q1 2015 comparison
• Revenues -2% on lower short-cycle volumes and timing of order backlog
• Operational EBITA margin[2] up 0.9 percentage points to 12.0%
• Power Grids in target margin corridor; strategic portfolio review of Power Grids on track
• Operational earnings per share[2] +3%[3]
• Cash flow from operating activities up approximately $200 million
• Financials impacted by currency translation due to appreciation of US dollar

“In the first quarter, we improved our margin and increased cash flow,” said CEO Ulrich Spiesshofer. “Our steady base order performance and book–to-bill ratio of 1.17x demonstrate that our focus on organic growth and the new market-oriented organization are yielding results in these challenging markets.”

“Our strategic initiatives are driving enhanced productivity and capital management,” he said. “We continue relentless execution and capacity adjustments, for example in Discrete Automation and Motion, where we have improved margins sequentially. Furthermore, the newly formed Power Grids and Electrification Products divisions started within the target margin corridor.”

“The strategic portfolio review of our Power Grids division is on track and we will report on it during our Capital Markets Day on October 4, 2016.”

“With our solid financial position and a leaner, more market-oriented organization, ABB is well positioned to weather continuing market headwinds and to drive profitable growth for the long term,” he added.

Short-term outlook

Macroeconomic and geopolitical developments are signaling a mixed picture with continued uncertainty. Some macroeconomic signs in the US remain positive and growth in China is expected to continue, although at a slower pace than in 2015. The market remains impacted by modest growth 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.

The complete press release including the appendices is available at www.abb.com/news

[1] Growth rates for orders, revenues and order backlog are on a comparable basis (local currency adjusted for acquisitions and divestitures), previously referred to as ‘like-for-like’. US$ growth rates are presented in Key Figures table 

[2] For a reconciliation of non-GAAP measures, see “Supplemental Reconciliations and Definitions” in the attached Q1 2016 Financial Information

[3] EPS growth rates are computed using unrounded amounts. Comparable operational earnings per share is in constant currency (2014 exchange rates and not adjusted for changes in the business portfolio)

ABB Ltd
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8050 Zurich
Switzerland

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Antonio Ligi, Sandra Wiesner
Tel: +41 43 317 71 11
media.relations@ch.abb.com

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investor.relations@ch.abb.com

For further information please refer to www.abb.com/news

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