ABB announces higher sales and profit targets

File Photo: The Hitachi ABB logo will be seen in an office building in Zurich, Switzerland, on September 10, 2020. Photo taken on September 10, 2020. REUTERS / Arnd Wiegmann / File Photo

December 7, 2021

John Revil

Zurich (Reuters)-Swiss engineering company expects to benefit from increased demand from trends such as economic recovery, decarbonization and shrinking workforce, so ABB will have sales and profits on Tuesday. Announced sexual goals.

Manufacturers of industrial automation and factory robots expect annual sales to grow in the range of 4% to 7% and the previous target of annual growth of 3% to 5% throughout the economic cycle. ..

In a new target announced the day before the capital markets on Tuesday, ABB has also raised its profitability target from 2023.

Still, the new goal has failed to appease activist investor Cevian Capital, who had previously campaigned to separate ABB’s grid business, and recently said ABB needs to further streamline its business. ..

ABB said it is in a good place to profit from trends such as demand for improved energy efficiency, and rising labor costs and a declining working age population are also driving demand for industrial automation and robots. rice field.

“Our technology leadership in electrification and automation, in line with sustainability and global megatrends, gives us a competitive edge,” said Bjorn Rosengren, Chief Executive Officer.

ABB has also raised its rate of return target, measured in interest, tax and operating profit before amortization (EBITA), from its previous target of 13% to “at least” 15%. During the pandemic 2020, ABB recorded a margin of 11.1%.

ABB stocks have finished a day higher by 1%.

ABB also said it plans to float its E-mobility electric vehicle charging business and go public in Switzerland in the first half of 2022.

Reuters previously reported that the business was worth about $ 3 billion.

CEO Rosengren said ABB has been implementing his plan to decentralize the company’s vast business, but it can still do much more.

“Over the last 24 months, ABB has made steady progress in implementing decentralized organizations and improving the quality of revenue,” said a former Sandvik CEO in a statement. “But we are not yet where we want to be.”

Cevian, ABB’s third-largest shareholder with a 5.16% stake, was unsatisfied, according to Refinitiv data.

Christian Guardel, Managing Partner of Sebian, said:

“I don’t know why ABB shouldn’t perform at least in line with its major competitor Schneider. Schneider has an organic growth target of over 5% and a margin target of 18-19%. We hope ABB will close its critical reputation. The gap with more focused competitors, “Gardell added.

ABB declined to comment on Guardel’s statement.

(Edited by Brenna Hughes Neghaiwi, Jacqueline Wong, Keith Weir)

ABB announces higher sales and profit targets

Source link ABB announces higher sales and profit targets

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