ABB Shares Slide After Drop in Orders

ZURICH—Shares in Swiss engineering giant ABB Ltd. slid Thursday after the company reported that third-quarter revenue fell from the previous year amid uncertainties over the U.S. presidential election and the U.K.'s decision to exit the European Union.

ABB shares fell more than 6% in early trading.

The disappointing quarterly showing came just weeks after ABB rebuffed calls from some of its largest shareholders to spin off its power grid unit, saying it would revamp the division instead under its ownership.

ABB said third-quarter revenue fell 3.1% to $8.26 billion from to $8.52 billion in the same period a year earlier. Analysts surveyed by Dow Jones Newswires had expected revenue of $8.33 billion.

"In the third quarter, we experienced significant macro uncertainties around Brexit and the U.S. elections as reflected in the low order pattern," ABB Chief Executive Ulrich Spiesshofer said.

Orders fell by more than $1 billion to $7.53 billion in the three months to end-September from $8.77 billion in the same period last year.

The company had noted weaker orders in its power-grids division ahead of the company's capital markets day earlier this month.

"ABB has delivered a significant orders miss, driven by customer deferrals in process end-markets, and due to uncertainty around the power grids separation," analysts at Morgan Stanley analysts wrote in a research note.

"We suspect that this may mark a low point in orders – we are inclined to be constructive in the event that the shares sell off significantly," the analysts wrote.

Write to Brian Blackstone at [e-mail]

(END) Dow Jones Newswires

October 27, 2016 05:15 ET (09:15 GMT)

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