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ABB blamed a fall in big projects for a 3 per cent drop in orders in the first three months of the year as the Swiss engineering group battles to return to a sustained growth path.
Ulrich Spiesshofer, ABB chief executive, is under pressure to boost performance at the sprawling Swiss conglomerate. However, orders fell to $8.4bn in the three months to the end of March. That was 9 per cent lower in dollar terms compared with a year earlier, or 3 per cent on a comparable basis.
ABB said orders fell 17 per cent in its power grids division – but orders in the comparable quarter a year ago had been boosted by a large order from China. Large orders worth $15m or more, were down 34 per cent.
However, ABB said first quarter revenues were up 3 per cent at $7.85bn on a comparable basis. Adjusted operating profits before tax rose 2 per cent to $943m.
Mr Spiesshoffer expected 2017 to be a “transitional year” for ABB. “We are seeing the first signals of market stabilization in some process industries, as well as some growth signals in early-cycle businesses,” he said. Despite the fall in orders, “overall, underlying demand in China remains positive,” he added.
ABB’s businesses include robots, engineering products and power systems, with much of its revenues depending on investment spending by companies and governments. Orders have been hit in recent years by sluggish global economic growth, upheaval in the energy sector and fierce competition. In 2016, orders fell by 5 per cent to $33.38bn.
The Swiss group returned to the acquisition trail earlier this month by acquiring Bernecker & Rainer, an Austrian specialist in factory computer operating systems, for a price estimated at up to $2bn. The deal strengthened the group’s portfolio in robotics and industrial automation where it faces stiff competition from rivals such as Germany’s Siemens.