ABB, the Swiss technology group, has announced that its fourth-quarter and 2023 results are in line with expectations. Despite the current geopolitical situation creating uncertainty, the company remains optimistic for another year of good performance in 2024.
Fourth Quarter Performance
In the fourth quarter, ABB reported a net profit of $921 million, a slight decrease from $1.13 billion in the same period last year. However, revenue saw a positive growth of 5%, reaching $8.245 billion. This increase was primarily driven by higher volumes and the contribution from earlier implemented price increases.
While revenue growth in the fourth quarter was slower compared to the previous three months, which saw an 8% increase, ABB still posted a strong 13% on-year rise in revenue for both the first and second quarters of 2023.
Analyst Expectations
Analysts had anticipated a net profit of $872 million and revenue of $8.10 billion, according to a company-compiled consensus. ABB’s reported figures exceeded these expectations, highlighting the company’s solid performance during the period.
Operational Earnings
ABB recorded operational earnings before interest, taxes, and amortization (EBITA) of $1.33 billion for the fourth quarter, up from $1.15 billion in the previous year. Although slightly below analysts’ estimates of $1.35 billion, this result demonstrates ABB’s robust operational performance.
In conclusion, ABB’s Q4 and 2023 results indicate a strong financial performance, with revenue growth and solid operational earnings. Despite the geopolitical challenges, the company remains confident in its prospects for 2024.
ABB Reports Flat Orders at $7.65 Billion in 2024
ABB, a leading technology company, has announced that its orders have remained flat at $7.65 billion compared to the previous year. While three business areas experienced growth, the robotics and discrete automation division witnessed a decline due to normalizing order patterns and inventory adjustments in a declining robotics market.
The company expects these inventory adjustments to level off by the end of the first quarter. In terms of regions, the Americas showed a 3% increase in orders, while Europe experienced a 2% decrease primarily driven by a double-digit decline in Germany. However, stable orders in Asia, the Middle East, and Africa were able to offset the 8% fall in China, thanks to strong performances in countries like India and South Korea.
Additionally, ABB is proposing an ordinary dividend of CHF0.87 per share, representing an increase from CHF0.84. The company also plans to continue utilizing share buybacks to return excess cash to shareholders throughout 2024.
Looking ahead, for the full year of 2024, ABB forecasts positive book-to-bill ratios and projects a comparable revenue growth of around 5%. Furthermore, they expect the operational EBITA margin to slightly improve from 17% in 2023.
In the first quarter of 2024, the company anticipates low to mid-single digit comparable revenue growth. They also expect the operational EBITA margin to either remain stable or experience a slight improvement compared to the previous year.
