— BERNSTEIN PAN EUROPEAN STRATEGIC DECISIONS CONFERENCE, LONDON, SEPTEMBER 28, 2017 Committed to unlocking value Leadership in the digital revolution Timo Ihamuotila, CFO, ABB LTD
— 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 September 27, 2017 Slide 2
— ABB: the pioneering technology leader Offering Pioneering technology leadership Products Systems Software & services Customers Utilities Industry Transport & Infrastructure ~35% of revenue ~40% of revenue ~25% of revenue Geographies Globally Asia, Middle East, Africa Americas Europe ~$35 bn revenue ~100 countries ~136,000 employees September 27, 2017 Slide 3 Pro forma: 2016 figures including B&R full-year figures
— 2017: living Next Level Clear priorities, implementation well under way Driving growth in four market-leading entrepreneurial divisions Shifting the Center of Gravity: competitiveness, growth, risk Profitable Growth Quantum leap in digital Value creating, strategic acquisitions and partnerships World-class operational excellence across the whole organization Relentless – White Collar Productivity, Net Working Capital, Quality Execution Linked strategy, performance management and compensation Market focused and lean organization Business-led Continued leadership development Collaboration Strengthening the global ABB brand September 27, 2017 Slide 4
— Four market-leading entrepreneurial divisions All businesses in #1 or 2 positions Market size 1 Top 3 Partner of choice for… Position Revenues 2 and growth competitors Schneider Electrification #2 in electrification ~$140 bn $9.9 bn Legrand …electrification of all consumption points Products 2 – 4% Eaton Siemens #1 in motion Robotics and ~$110 bn $7.9 bn Fanuc …robotics and intelligent motion solutions 3 – 8% 3 Motion #2 in robotics Kuka Siemens Industrial ~$130 bn #2 in industrial $6.8 bn Emerson …industrial automation 1 – 5% 4 automation 7 Automation Schneider Siemens Power ~$110 bn 5 …a stronger, smarter and greener grid #1 in T&D $10.9 bn GE Grids 3 – >10% 6 Hyundai 1 Unconsolidated 2016; 2 2016 revenues in new structure as of January 2017; 3 8% for robotics market; 4 Discrete automation segment; September 27, 2017 Slide 5 5 Consolidated, $140 bn unconsolidated; 6 In certain segments; 7 After the close of B&R acquisition
— Leadership in industrial automation B&R – 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 September 27, 2017 Slide 6
— ABB and B&R – strong #2 in industrial automation Business volume industrial automation (products, software, solutions, services) ~$15 bn Siemens ABB 1 + B&R Emerson GE Schneider Fanuc Honeywell Rockwell Yaskawa Yokogawa KUKA September 27, 2017 Slide 7 Source: Management estimate, based on revenues, 1 Excl. electrification
— Leadership in electrification ABB to acquire GE Industrial Solutions (GE IS) for $2.6 billion Deal rationale Market access Expanded access to North America − Significant installed base globally − Performance improvement Non-core business for GE − Significant value creation potential: − • ABB technology leadership • Cost synergies Comprehensive electrification portfolio Complementary portfolio and solutions − Strategic supply partnership GE to tap ABB’s leading portfolio through long -term supply − partnership September 27, 2017 Slide 8
— GE IS and ABB Strengthening global #2 in electrification Global electrification revenues $12.3 bn Legrand Schneider ABB & Eaton Hubbell Vertiv Hager Chint Leviton Siemens GE IS Source: Management estimate, based on revenues September 27, 2017 Slide 9 Electrification: low- and medium-voltage electrical distribution products and solutions
— ABB Ability™: industry -leading digital solutions Successful launch in Europe, Americas and AMEA 1 in H1 2017 180+ ABB Ability™ solutions Transportation & Utilities Industry Infrastructure solutions solutions solutions Platform (common technologies for device, edge, and cloud) September 27, 2017 Slide 10 AMEA: Asia, Middle East and Africa
— Why ABB? Pioneering technology leader Strong positions in attractive markets Clear transformation agenda driving operational EPS and CROI Efficient balance sheet; generating attractive returns for shareholders Committed to unlocking value September 27, 2017 Slide 11
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