ABB 3Q With Lower Net Profit, Revenue -- Earnings Review

By Kim Richters

Swiss engineering company ABB Ltd. (ABBN.EB) reported results for its third quarter earlier today. Here's what you need to know:

PROFIT: Net profit for the period fell to $515 million from $603 million a year earlier, the company said. It beat expectations of $363 million for the quarter.

REVENUE: Revenue for the period fell to $6.89 billion from $7.10 billion the previous year, it said. Analysts expected $6.94 billion.

OPERATIONAL EBITA: Operational Ebita fell to $806 million from $814 million. The company beat another consensus forecast of $792 million, but consensus for this figure had been lowered by 6% recently, according to Citi.

WHAT WE WATCHED:

-SALE & ACQUISITION PROGRESS: ABB's sold power-grids business was reported as discontinued operations in the earnings report. The unit's performance was "surprisingly weak at $128 million EBIT," Morgan Stanley says.

-CAUTIOUS OUTLOOK: As expected, ABB remained cautious, with a mixed outlook for Europe and China and a weakening one for the U.S. The company said it continues to expect a "slight revenue growth and improved operating margins," which could lead to consensus upgrades of margins, UBS says.

-MODERATE GROWTH: ABB's electrification and motion businesses grew in revenue, while robotics and discrete automation as well as industrial automation declined, with the latter negatively impacted by the revaluation of a project. "Given the magnitude of the recent upcycle, which is ending, we are disappointed by the overall growth performance," Morgan Stanley says.

Write to Kim Richters at [e-mail]

(END) Dow Jones Newswires

October 23, 2019 06:49 ET (10:49 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.