ABB Results Hit Targets, Expects Positive Performance in 2024 — Update

By Andrea Figueras

ABB said Thursday that its fourth-quarter and 2023 results were in line with its guidance and that it expects another year of good performance in 2024, despite the geopolitical situation adding uncertainty.

The Swiss technology group said Thursday that it made $921 million in net profit for the fourth quarter compared with $1.13 billion in the prior-year period. Revenue increased 5% on year to $8.245 billion, on higher volumes and contribution from earlier implemented price increases, it said.

However, revenue growth in the fourth quarter slowed compared with the previous three months, when the company saw an 8% increase. For both the first and second quarter of 2023, ABB posted a 13% on-year rise in revenue.

Analysts had expected $872 million in net profit and $8.10 billion in revenue, according to a company-compiled consensus.

ABB booked operational earnings before interest, taxes and amortization of $1.33 billion, up from $1.15 billion and slightly below analysts' estimates of $1.35 billion, according to company-compiled consensus.

Orders were flat on year at $7.65 billion. They increased in three business areas, while the robotics and discrete automation division saw a drop, due to normalizing order patterns and inventory adjustments in a declining robotics market, the company said.

"These inventory adjustments are expected to level off towards the end of the first quarter," it said.

As for regions, Americas was up by 3%, while Europe decreased by 2% due mainly to a double-digit decline in Germany, ABB said. In Asia, Middle East and Africa orders remained overall stable and a strong performance in countries like India and South Korea helped offset the 8% fall in China.

ABB is proposing an ordinary dividend of CHF0.87 a share, up from CHF0.84. "We also plan to continue utilizing share buybacks as a tool to return excess cash to shareholders also during 2024," the company said.

For the year as a whole, it forecasts a positive book-to-bill, comparable revenue growth of around 5% and the operational EBITA margin to slightly improve from 17% in 2023.

For the first quarter of 2024, the company anticipates low to mid-single digit comparable revenue growth and the Operational Ebita margin to remain stable or slightly improve on year.

Write to Andrea Figueras at andrea.figueras@wsj.com

(END) Dow Jones Newswires

February 01, 2024 02:31 ET (07:31 GMT)

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