ABB Reports Q2 Below Street View, Exits Russian Market, Plans Turbocharging Spin-Off

  • ABB Ltd ABB reported a second-quarter FY22 revenue decline of 2.7% year-over-year to $7.25 billion, up 6% on a comparable basis, missing the consensus of $7.47 billion.
  • EPS improved was $0.20 (-47% Y/Y), below the consensus of $0.31.
  • Orders increased by 10% Y/Y to $8.81 billion and grew 20% on a comparable basis.
  • Electrification revenue $3.53 billion (+4% Y/Y), Orders $4.04 billion (+9% Y/Y) and Backlog $6.71 billion (+33% Y/Y).
  • Motion revenue $1.63 billion (-12% Y/Y), Orders $2.08 billion (+7% Y/Y) and Backlog $4.57 billion (+28% Y/Y).
  • Process Automation revenue $1.53 billion (-1% Y/Y), Orders $1.82 billion (+17% Y/Y) and Backlog $6.17 billion (+3% Y/Y).
  • Robotics & Discrete Automation revenue $732 million (-12% Y/Y), Orders $1.11 billion (+15% Y/Y) and Backlog $2.73 billion (+82% Y/Y).
  • Gross profit margin contracted by 210 bps to 31.6%. Operating income totaled $587 million (-46.3% Y/Y), and the margin was 8.1% for the quarter, down by 660 bps.
  • Operational EBITA was up 2% Y/Y to $1.14 billion, and the margin expanded by 50 bps to 15.5%.
  • ABB's cash used in operating activities in continuing operations year-to-date was $179 million, compared to cash generated of $1.19 billion a year ago.
  • The company stated that on the back of the volatile financial markets, it has decided to postpone the planned IPO of the E-mobility business.
  • ABB plans to spin off Accelleron and list it on the SIX Swiss Exchange in October, subject to shareholders' approval. ABB shareholders would receive 1 Accelleron share for every 20 ABB shares held.
  • ABB has decided to exit the Russian market. The financial impact amounted to $57 million in Q2, of which $23 million will impact cash flow in Q3.
  • 3Q Outlook: ABB anticipates double-digit comparable revenue growth and the Operational EBITA margin to improve sequentially.
  • In FY22, the company expects a steady margin improvement towards the 2023 target of at least 15%.
  • Price Action: ABB shares traded higher by 1.60% at $28.53 on the last check Thursday.
Market News and Data brought to you by Benzinga APIs
Comments
Loading...
Posted In: EarningsNewsGuidanceBriefs
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!