abb continues its transformation
play

ABB continues its transformation Ulrich Spiesshofer, CEO; Timo - PowerPoint PPT Presentation

ABB LTD, ZURICH, SWITZERLAND, APRIL 20, 2017, Q1 2017 RESULTS ABB continues its transformation Ulrich Spiesshofer, CEO; Timo Ihamuotila, CFO Important notices This presentation includes forward-looking information and statements including


  1. ABB LTD, ZURICH, SWITZERLAND, APRIL 20, 2017, Q1 2017 RESULTS ABB continues its transformation Ulrich Spiesshofer, CEO; Timo Ihamuotila, CFO

  2. Important notices This presentation includes forward-looking information and statements including statements concerning the outlook for our businesses. These statements are based on current expectations, estimates and projections about the factors that may affect our future performance, including global economic conditions, and the economic conditions of the regions and industries that are major markets for ABB Ltd. These expectations, estimates and projections are generally identifiable by statements containing words such as “expects,” “believes,” “estimates,” “targets,” “plans,” “outlook” or similar expressions. There are numerous risks and uncertainties, many of which are beyond our control, that could cause our actual results to differ materially from the forward-looking information and statements made in this presentation and which could affect our ability to achieve any or all of our stated targets. The important factors that could cause such differences include, among others: – business risks associated with the volatile global economic environment and political conditions – costs associated with compliance activities – market acceptance of new products and services – changes in governmental regulations and currency exchange rates, and – such other factors as may be discussed from time to time in ABB Ltd’s filings with the U.S. Securities and Exchange Commission, including its Annual Reports on Form 20-F. Although ABB Ltd believes that its expectations reflected in any such forward-looking statement are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved. This presentation contains non-GAAP measures of performance. Definitions of these measures and reconciliations between these measures and their US GAAP counterparts can be found in the ‘Supplemental reconciliations and definitions’ section of “Financial Information” under “Quarterly results and annual reports” on our website at www.abb.com/investorrelations Slide 2 April 20, 2017

  3. Q1 2017: key figures Orders Base orders Revenues $8.4 bn $7.6 bn $7.9 bn 1 1 1 -3% +2% +3% Cash flow from operating Operational EBITA margin Operational EPS activities 12.1% $0.28 $509 mn 3 2 steady +1% +102% 1 On a comparable basis; 2 Operational EPS growth is in constant currency (2014 foreign Slide 3 April 20, 2017 exchange rates); 3 Improvement primarily related to delay of incentive payments

  4. Q1 2017: ABB continues its transformation Revenues up 3%; book to bill ratio 1.07x Base orders up 2%; total orders reflect lower large contract awards Profitable Growth Active portfolio management: HVcables business divested, B&R acquisition announced April 4 Commercial launch of ABB Ability TM Op EBITA margin 12.1% Solid operating leverage considering 60 bps positive insurance reserve adjustment in 2016 Relentless Execution Continued delivery on productivity and cost savings program Net income $724 million; operational EPS up 1% 1 Entrepreneurial spirit in performance / compensation system enhanced Business-led Improved country and account collaboration drives momentum (e.g. F&B, 3C, service) Collaboration Global Business Service centers operational; Krakow facility inaugurated Delivering on Next Level strategy 1 Constant currency 2014 rates Slide 4 April 20, 2017

  5. Q1 2017: regional order development Base orders up 2% 2017 Q1 total order growth by region 2017 Q1 base order growth 2 Change on a comparable basis Change on a comparable basis US +3% China -3% Europe Germany +14% Total +2% India +11% Germany -26% Canada UK +35% -5% France +134% Italy -1% Italy +1% Sweden +45% Base orders +7% UK Americas AMEA 1 +3% Total +4% Saudi Arabia Total -12% -40% US +5% South Korea China -27% +4% Canada +3% India +15% Finland +7% Brazil -8% UAE +34% Norway -6% Base orders +1% Base orders -2% Spain +8% China’s underlying demand positive, high HVDC comparable in 2016 1 AMEA: Asia, Middle East and Africa; 2 Selected countries from among ABB’s Top 20 countries Slide 5 April 20, 2017 by total order volume

  6. Q1 2017: performance by division Key figures Electrification Robotics and Industrial Power Electrification Robotics and Industrial Power $ bn ABB Group ABB Group Products Motion Automation Grids unless otherwise Products Motion Automation Grids stated 8.4 2.5 2.2 1.7 2.4 Orders Δ Comparable -3% +4% +7% -6% -17% 7.9 2.3 1.9 1.5 2.4 Revenues Δ Comparable +3% +3% +5% -5% +4% 12.1% 14.1% 14.3% 13.3% 10.3% Op. EBITA % steady +60 bps -100 bps +130 bps +280 bps Δ Slide 6 April 20, 2017

  7. Q1 2017: operational EBITA Solid operating leverage 12.1% op. 12.1% op. EBITA margin EBITA margin Operational EBITA bridge Q1 2016 to Q1 2017, $ mn +10 -8 -78 +34 +121 -24 -50 -13 951 901 943 Op. EBITA Insurance Op. EBITA Net Net Project Mix Other Forex Divest. Op. EBITA Q1 2016 underlying savings volume margins Q1 2017 Q1 2016 Slide 7 April 20, 2017

  8. Q1 2017: net working capital and cash flow Net Working Capital reduction A solid, consistent cash generator NWC as a % of revenues Cash flow from operating activities, $ mn 18 Q1 Q2 17 1600 16 1400 15 1200 1000 14 2014 800 1,082 13 2015 600 12 400 2016 509 11 200 2017 252 0 10 Q4 Q1 Q2 Q3 Q4 2016 2017 Continued focus on working capital mgmt. Q1 2017 improvement reflects delay in incentive payments to Q2 caused by South Korea case Slide 8 April 20, 2017

  9. Next Level Stage 3 – committed to unlocking value Four actions ANNOUNCED OCTOBER 4 TH , 2016 1 Driving growth in four market-leading entrepreneurial divisions Profitable Growth 2 Quantum leap in digital Relentless 3 Accelerating momentum in operational excellence Execution Business-led 4 Strengthening the global ABB brand Collaboration Delivering attractive shareholder returns Slide 9 April 20, 2017

  10. Acquisition of B&R – leadership in industrial automation Closing ABB’s historic gap in machine and factory automation Deal rationale Attractive market segment (CAGR 4-5%) Attractive company (CAGR ~11%) Attractive strategic rationale (shaping global #2 in industrial automation) Attractive financials (incl. strong growth and cost synergies) B&R ABB ANNOUNCED APRIL 4 TH , 2017 Slide 10 April 20, 2017

  11. B&R – a leader in machine and factory automation Integrated product, software and solutions portfolio SOLUTIONS SOFTWARE IPC / HMI Visualization software PLC Application store PLC (Programmable Logic Controller) IPC (Industrial PC) FIELD DEVICES SERVO MOTION Automation Studio Servo drives Servo motors I/O modules ~4,000 machine builder / >3,000 employees 2 , >$600 mn revenue 1 CAGR ~11% since 1995 $75 mn, 12% EBIT 1 OEM customers >1,000 R&D & application engineers 1 FY 2015/16; 2 As of June 30, 2016 Slide 11 April 20, 2017

  12. B&R and ABB – leadership in industrial automation Closing ABB’s historic gap in machine and factory automation Sensing & DCS PLC / IPC Industrial Robotics Digital Electrification 2 analytics servo motion motion 1 platform B&R ABB B&R + ABB Siemens Emerson GE Schneider Fanuc Honeywell Rockwell Yaskawa Yokogawa KUKA Note: indicates competitive offering 1 Motors, drives; 2 low-voltage, medium-voltage and power quality Slide 12 April 20, 2017

  13. B&R and ABB – strong #2 in industrial automation Business volume industrial automation (products, software, solutions, services) ~$ 15bn Siemens ABB + B&R Emerson GE Schneider Fanuc Honeywell Rockwell Yaskawa Yokogawa KUKA ABB 1 + B&R Source: Management estimate, based on revenues, 1 Excl. electrification Slide 13 April 20, 2017

  14. Q1 2017: Power Grids continuing to transform Power Up well underway Operational EBITA margin, % Shifting the Center of Gravity 14% Future – Business model change range 2 12% – HV cables divestment closed Current range 10% – Commercial launch of ABB Ability 10.3 9.3 8% – Investment in Enbala – a distributed energy management company 7.2 Operational Excellence 4.6 – WCP program – Project execution – Quality and continuous improvement 2014 2015 2016 Q1 2014 FY 2015 FY 2016 FY Q1 2017 FY 1 FY 1 FY 1 2017 – Working capital initiative Sustainable 2X margin improvement since 2014 1 Estimated to exclude the divestment of the Cables business which has been reclassified to Corporate and other for all periods prior to the divestment. Slide 14 April 20, 2017 2 New target margin range of 10-14% effective in 2018

  15. Q1 2017: commercially launched ABB Ability 180+ ABB Ability solutions customized for our end markets Utilities Industry Transport & Infrastructure ABB solutions solutions solutions Ability Platform (common technologies for device, edge, and cloud) Slide 15 April 20, 2017

  16. Continuing to shift ABB’s Center of Gravity Strengthening competitiveness Robotics acquisitions Service growth Strategic partnerships ABB Ability B&R Substation EPC partnership Cable divestiture Expansion in high-growth markets Offshore wind business model change Lowering risk Driving organic growth Slide 16 April 20, 2017

Download Presentation
Download Policy: The content available on the website is offered to you 'AS IS' for your personal information and use only. It cannot be commercialized, licensed, or distributed on other websites without prior consent from the author. To download a presentation, simply click this link. If you encounter any difficulties during the download process, it's possible that the publisher has removed the file from their server.

Recommend


More recommend