TIDMANN
RNS Number : 5676B
ABB Ltd
29 October 2009
Cost take-out holds EBIT margin on target, strong cash flow of more than $1 bn
* $1 bn net income incl. $380-million gain from previously-announced provision
adjustments
* EBIT margin excluding provision adjustments well within the 11-16% target range
* Cash from operations at $1.3 bn on lower inventories and improved cash
collection
* Orders down double digits despite strong power infrastructure orders
Zurich, Switzerland, October 29, 2009 - ABB reported third-quarter net income of
$1 billion, including a $380-million net gain for various previously-announced
provision adjustments, and earnings before interest and taxes (EBIT) of $1.4
billion.
Orders declined to $7.1 billion, equivalent to a local-currency reduction of 15
percent, while revenues decreased to $7.9 billion, lower by 5-percent in local
currency1. Investments in power grids continued to grow but lower demand for
shorter-cycle products in industrial markets resulted in a 23-percent local
currency decrease in base orders (below $15 million). The order decrease also
reflects price declines resulting from both lower material costs and weaker
demand. The share of orders from emerging markets increased to 55 percent.
EBIT was positively impacted by previously-announced adjustments to provisions
and the mark-to-market treatment of hedging transactions. Restructuring-related
costs were approximately $40 million.
Excluding these factors, EBIT and EBIT margin were lower than in the same
quarter in 2008, primarily reflecting the business mix, decreased capacity
utilization and lower prices in short-cycle businesses. These impacts were
partially offset by ABB's cost take-out program which yielded savings in the
quarter of approximately $500 million.
Net income of $1 billion includes the positive $380-million net contribution
from the provision adjustments mentioned above. Cash from operations
was $1.3 billion on a significant reduction in inventories and improved cash
collection.
"We turned in a strong cash performance this quarter and held EBIT margins well
within our target range thanks to the continued timely execution of the order
backlog and further progress in our cost take-out program," said Joe Hogan,
ABB's Chief Executive Officer.
"Order trends were in line with what we saw in the second quarter, with steady
demand in power and oil and gas but lower base orders in industrial markets,"
Hogan said. "We'll continue to focus on making sure our costs are in line with
market demand, but at the same time stay aggressively positioned to capture the
significant growth opportunities in power infrastructure, renewables, energy
efficiency and emerging markets."
__________________________________
1 Management discussion of orders and revenues focuses on local currency
changes. U.S. dollar changes are reported in the results tables.
2009 Q3 key figures
+--------------------------------+----------+----------+----------+----------+
| | Q3 09 | Q3 08 | Change |
+--------------------------------+----------+----------+---------------------+
| $ millions unless otherwise | | | US$ | Local |
| indicated | | | | |
+--------------------------------+----------+----------+----------+----------+
| Orders | 7,060 | 8,885 | -21% | -15% |
+--------------------------------+----------+----------+----------+----------+
| Order backlog (end Sep) | 26,159 | 27,211 | -4% | -4% |
+--------------------------------+----------+----------+----------+----------+
| Revenues | 7,910 | 8,791 | -10% | -5% |
+--------------------------------+----------+----------+----------+----------+
| EBIT | 1,419 | 1,291 | 10% | |
+--------------------------------+----------+----------+----------+----------+
| as % of revenues | 17.9% | 14.7% | | |
+--------------------------------+----------+----------+----------+----------+
| Net income | 1,034 | 927 | 12% | |
+--------------------------------+----------+----------+----------+----------+
| Basic net income per share ($) | 0.45 | 0.41 | | |
+--------------------------------+----------+----------+----------+----------+
| Cash flow from operating | 1,281 | 1,121 | | |
| activities | | | | |
+--------------------------------+----------+----------+----------+----------+
Summary of Q3 2009 results
Orders received and revenues
Orders decreased in the third quarter compared to the year-earlier period as
utility investments to expand and refurbish power transmission grids were more
than offset by lower demand from most of ABB's industrial markets and the
construction sector.
Regionally, orders in local currency were higher in the Americas due mainly to a
large power transmission order from Brazil which more than compensated for lower
orders in the U.S. Orders in the Middle East and Africa also increased as the
result of growth in power orders. Orders were down 25 percent in local
currencies in Europe as growth in the Power Systems division, driven mainly by
power grid upgrades in western Europe, were more than offset by broad declines
in all other divisions, reflecting the generally weak economic environment
compared to the same quarter a year ago. Orders in Asia were down 24 percent in
local currencies, mainly due to lower marine orders from South Korea and power
orders in Australia. Orders in China declined at a single-digit pace in the
quarter but were supported by double-digit growth in Automation Products.
Large orders (above $15 million) increased by 42 percent in local currencies
compared to the same quarter in 2008.
Revenues declined in the quarter as execution of the order backlog was offset
by weaker revenues in shorter-cycle businesses. Service revenues were 2 percent
lower in local currencies compared to the third quarter of 2008, mainly
reflecting reduced operational expenditures by industrial customers as they
adjust costs to the current demand environment.
The order backlog at the end of September 2009 amounted to $26.2 billion,
corresponding to a local-currency increase of 4 percent year to date. Compared
to the end of the second quarter of 2009, the order backlog is down 3 percent in
local currencies.
Earnings before interest and taxes
EBIT and EBIT margin increased compared to the same quarter a year
earlier because of previously-announced adjustments to provisions. These
adjustments, related to provisions for alleged anti-competitive practices as
well as an increase in provisions with respect to ABB's business in Russia,
resulted in a net increase in EBIT of approximately $430 million.
Also included in third-quarter 2009 EBIT are restructuring-related costs of
approximately $40 million related to the two-year, $2-billion cost take-out
program announced earlier this year.
The mark-to-market impact from hedging transactions had a positive impact on
EBIT in the third quarter equivalent to approximately 0.6 percentage points of
EBIT margin. The impact in the same quarter last year was negative in an amount
equivalent to approximately one percentage point of EBIT margin.
For purposes of comparison, the third-quarter 2009 EBIT margin, excluding the
impact of provision adjustments, restructuring and the mark-to-market impact
from hedging transactions, is approximately 3.5 percentage points lower than the
EBIT margin in the same quarter in 2008, also adjusted for the impact of the
mark-to-market impact from hedging transactions described above.
This decrease primarily reflects the combination of lower revenues from
higher-margin product businesses, as well as lower capacity utilization and
price pressure mainly in ABB's short-cycle businesses compared to the same
period a year earlier.
EBIT and EBIT margin were positively impacted by cost savings in sourcing,
general and administrative expenses, as well as footprint adjustments and
operational excellence initiatives, amounting to approximately $500 million in
the quarter. Year-to-date, the cost take-out program has generated savings in
excess of $1 billion.
Net income
Third-quarter net income of approximately $1 billion includes a positive
$380-million impact resulting from previously-announced provision adjustments.
This amount is comprised of the $430-million improvement to EBIT described above
less approximately $50 million in interest and other finance expense and income
taxes.
Balance sheet and cash flow
Net cash at the end of the third quarter was $5.8 billion compared to $5.7
billion at the end of the previous quarter. Cash flow from operations amounted
to $1.3 billion while cash used in financing activities included a dividend
payment of $1 billion in the form of a nominal value reduction, made at the end
of July 2009, as approved by shareholders at the Annual General Meeting in May.
Compliance
As previously announced, ABB has disclosed to the U.S. Department of Justice and
the U.S. Securities and Exchange Commission various suspect payments.
Also as previously announced, ABB has been cooperating with various anti-trust
authorities regarding certain allegedly anti-competitive practices in the power
transformer business. On October 7, 2009, the European Commission announced its
decision on this matter and imposed a fine of EUR33.75 million on ABB. In
addition, ABB's cables business is under investigation for alleged
anti-competitive practices.
With respect to these matters, there could be adverse outcomes beyond our
provisions.
Cost reductions
ABB continued to execute its previously-announced cost take-out program during
the third quarter. The program aims to sustainably reduce ABB's costs -
comprising both cost of sales as well as general and administrative expenses -
from 2008 levels by a total of $2 billion by the end of 2010. The savings are
focused on acceleration of ongoing initiatives in low-cost sourcing, general and
administrative expenses, internal process improvements and adjustments to ABB's
global manufacturing and engineering footprint.
Cost reductions for the first three quarters of 2009 were significantly ahead of
plan and exceeded $1 billion, equal to the original targeted take-out for the
full year. Approximately 60 percent of these savings were achieved by optimizing
global sourcing (excluding the impact of exchange-traded commodities). The
remainder was achieved through reductions to general and administrative
expenses, as well as global footprint and operational excellence measures.
The total cost of the program is expected to approach $1 billion - of which
approximately $100 million was already recorded in 2008. Costs associated with
the program in the third quarter of 2009 amounted to approximately $40 million,
bringing the total cost so far in 2009 to approximately $170 million.
Management appointments
ABB announced in September the appointment of Brice Koch to the Group Executive
Committee as Head of Marketing and Customer Solutions, a new role created to
drive additional growth across the company's markets and regions. The
appointment is effective January 1, 2010.
Outlook
The outlook for ABB's businesses over the rest of 2009 and into 2010 remains
uncertain.
The need for energy-efficient power infrastructure remains in all regions,
supported by political measures to address climate change and increasing demand
for renewable power generation. Demand in ABB's industrial end markets depends
to a large extent on GDP growth and capital spending, together with commodity
prices. Customers' need to steadily improve energy efficiency and productivity
also drives orders. Increasing commodity prices generally support ABB's
industrial businesses as they promote customer investment in capacity expansion.
However, it remains unclear when and how quickly capital investments by
customers will recover from the downturn. In addition, the volatility of raw
material prices and the limited availability of project funding continue
to influence the timing of many power and industrial investment decisions,
especially among small- to medium-sized companies.
Therefore, management's priority for the next several quarters will be to ensure
that the company has the flexibility to respond quickly to changing market
conditions, taking advantage of its global footprint, strong balance sheet and
leading technologies to improve its cost competitiveness while simultaneously
tapping further opportunities for profitable growth.
Divisional performance Q3 2009
Power Products
+--------------------------------+----------+---------+-----------+------------+
| | Q3 09 | Q3 08 | Change |
+--------------------------------+----------+---------+------------------------+
| $ millions unless otherwise | | | US$ | Local |
| indicated | | | | |
+--------------------------------+----------+---------+-----------+------------+
| Orders | 2,553 | 3,409 | -25% | -21% |
+--------------------------------+----------+---------+-----------+------------+
| Order backlog (end Sep) | 8,712 | 9,081 | -4% | -4% |
+--------------------------------+----------+---------+-----------+------------+
| Revenues | 2,823 | 3,034 | -7% | -2% |
+--------------------------------+----------+---------+-----------+------------+
| EBIT | 477 | 536 | -11% | |
+--------------------------------+----------+---------+-----------+------------+
| as % of revenues | 16.9% | 17.7% | | |
+--------------------------------+----------+---------+-----------+------------+
| Cash flow from operating | 592 | 479 | | |
| activities | | | | |
+--------------------------------+----------+---------+-----------+------------+
Orders received declined across all regions compared to the same quarter a year
ago, mainly as a result of lower demand in industrial and construction-related
markets. Order intake was further impacted by lower prices due both to weaker
market conditions and pass-through of reduced commodity costs.
Revenues decreased in the quarter as execution of the order backlog in
longer-cycle businesses, such as high-voltage equipment, was partly offset by
lower revenues from shorter-cycle businesses related to the industrial and
construction sectors, such as medium-voltage equipment and distribution
transformers. Revenues were also negatively impacted by delays in customer
acceptance of products.
EBIT and EBIT margin were lower mainly on reduced revenues but also reflecting
the lower share of higher-margin short-cycle product revenues compared to the
same quarter a year earlier.
Cash flow from operations improved in the quarter, largely due to a reduction in
inventories.
Power Systems
+--------------------------------+----------+---------+-----------+------------+
| | Q3 09 | Q3 08 | Change |
+--------------------------------+----------+---------+------------------------+
| $ millions unless otherwise | | | US$ | Local |
| indicated | | | | |
+--------------------------------+----------+---------+-----------+------------+
| Orders | 1,991 | 1,293 | 54% | 70% |
+--------------------------------+----------+---------+-----------+------------+
| Order backlog (end Sep) | 9,770 | 8,661 | 13% | 14% |
+--------------------------------+----------+---------+-----------+------------+
| Revenues | 1,612 | 1,601 | 1% | 7% |
+--------------------------------+----------+---------+-----------+------------+
| EBIT | 117 | 113 | 4% | |
+--------------------------------+----------+---------+-----------+------------+
| as % of revenues | 7.3% | 7.1% | | |
+--------------------------------+----------+---------+-----------+------------+
| Cash flow from operating | 11 | 111 | | |
| activities | | | | |
+--------------------------------+----------+---------+-----------+------------+
Orders increased significantly in the third quarter due to a strong increase in
large orders from utilities to expand power transmission capacity that more than
compensated for lower industrial demand. Regionally, orders were higher in the
Americas, mainly the result of a $540-million order for a high-voltage direct
current (HVDC) power link in Brazil. Orders also grew in Europe and the Middle
East but decreased in Asia as lower orders in Australia and China more than
offset strong growth in India.
Revenues increased on execution of the continuing strong order backlog, leading
to higher EBIT and EBIT margin. The mark-to-market treatment of hedging
transactions had a positive impact in the quarter that was offset by charges
related to project execution and provisions related to the business in Russia.
Cash flow from operations was lower than in the same quarter a year earlier due
to higher net working capital needed for projects in execution.
Automation Products
+-----------------------------+----------+------------+-----------+------------+
| | Q3 09 | Q3 08 | Change |
+-----------------------------+----------+------------+------------------------+
| $ millions unless otherwise | | | US$ | Local |
| indicated | | | | |
+-----------------------------+----------+------------+-----------+------------+
| Orders | 2,033 | 2,741 | -26% | -22% |
+-----------------------------+----------+------------+-----------+------------+
| Order backlog (end Sep) | 3,940 | 4,380 | -10% | -12% |
+-----------------------------+----------+------------+-----------+------------+
| Revenues | 2,234 | 2,612 | -14% | -10% |
+-----------------------------+----------+------------+-----------+------------+
| EBIT | 340 | 491 | -31% | |
+-----------------------------+----------+------------+-----------+------------+
| as % of revenues | 15.2% | 18.8% | | |
+-----------------------------+----------+------------+-----------+------------+
| Cash flow from operating | 536 | 509 | | |
| activities | | | | |
+-----------------------------+----------+------------+-----------+------------+
Continued weakness in ABB's industrial and construction end markets in the third
quarter resulted in a decrease in both base and large orders received compared
to the same period a year earlier. Orders increased in China but were lower than
last year in the rest of Asia and in all other regions. Orders were also
impacted by lower prices resulting from a decrease in material costs as well as
reduced demand.
Revenues declined more slowly than orders in the quarter as execution of the
strong order backlog in businesses such as machines and power electronics partly
offset lower revenues in shorter-cycle businesses such as low-voltage products.
EBIT and EBIT margin in the quarter declined compared to the very strong third
quarter in 2008. This was mainly due to lower revenues and restructuring-related
costs of $12 million to adapt to the weaker demand environment.
Cash flow from operations was higher, primarily due to a reduction in net
working capital, mainly lower inventories.
Process Automation
+-----------------------------+----------+------------+----------+-------------+
| | Q3 09 | Q3 08 | Change |
+-----------------------------+----------+------------+------------------------+
| $ millions unless otherwise | | | US$ | Local |
| indicated | | | | |
+-----------------------------+----------+------------+----------+-------------+
| Orders | 1,145 | 1,969 | -42% | -39% |
+-----------------------------+----------+------------+----------+-------------+
| Order backlog (end Sep) | 6,064 | 7,146 | -15% | -16% |
+-----------------------------+----------+------------+----------+-------------+
| Revenues | 1,809 | 1,920 | -6% | 0% |
+-----------------------------+----------+------------+----------+-------------+
| EBIT | 164 | 218 | -25% | |
+-----------------------------+----------+------------+----------+-------------+
| as % of revenues | 9.1% | 11.4% | | |
+-----------------------------+----------+------------+----------+-------------+
| Cash flow from operating | 254 | 243 | | |
| activities | | | | |
+-----------------------------+----------+------------+----------+-------------+
Orders continued to decline in the third quarter compared to the same quarter in
2008 as steady demand from the oil and gas sector was more than offset by
ongoing weakness in other sectors. Large orders declined by more than 50 percent
in both U.S. dollar and local currency terms and base orders were also down at a
double-digit pace. Orders decreased in all regions except the Middle East and
Africa, where demand from the oil and gas sector supported a local-currency
order increase. Orders in Asia decreased on a reduction in marine orders, mainly
from South Korea and Singapore.
Revenues were down (flat in local currencies) in the quarter as execution of the
strong order backlog in the marine, minerals and oil and gas businesses was
offset by lower revenues in pulp and paper and from lower book-and-bill product
sales in the quarter. Service revenues were flat in local currencies.
EBIT and EBIT margin declined compared to the same quarter a year earlier,
however, largely due to the high share of systems revenues that typically carry
a lower EBIT margin. The mark-to-market treatment of hedging transactions also
negatively impacted EBIT in the quarter.
Cash flow from operations increased in the quarter, mainly reflecting the timing
of large project payments and measures to improve net working capital
management.
Robotics
+--------------------------------+----------+----------+---------+-------------+
| | Q3 09 | Q3 08 | Change |
+--------------------------------+----------+----------+-----------------------+
| $ millions unless otherwise | | | US$ | Local |
| indicated | | | | |
+--------------------------------+----------+----------+---------+-------------+
| Orders | 169 | 400 | -58% | -56% |
+--------------------------------+----------+----------+---------+-------------+
| Order backlog (end Sep) | 367 | 665 | -45% | -46% |
+--------------------------------+----------+----------+---------+-------------+
| Revenues | 211 | 431 | -51% | -49% |
+--------------------------------+----------+----------+---------+-------------+
| EBIT | (36) | 28 | n/a | |
+--------------------------------+----------+----------+---------+-------------+
| as % of revenues | -17.1% | 6.5% | | |
+--------------------------------+----------+----------+---------+-------------+
| Cash flow from operating | (5) | (9) | | |
| activities | | | | |
+--------------------------------+----------+----------+---------+-------------+
Robotics orders declined as the result of a significant drop in demand from the
global manufacturing sector compared to the same period in 2008. Revenues
decreased on a lower opening order backlog and reduced service business.
The division reported an EBIT loss related to low factory loading, declining
service revenues and further capacity adjustments and changes to the operational
footprint.
More information
The 2009 Q3 results press release and presentation slides are available from
October 29, 2009, on the ABB News Center at www.abb.com/news and on the Investor
Relations homepage at www.abb.com/investorrelations.
ABB will host a media conference call starting at 10:00 a.m. Central European
Time (CET). U.K. callers should dial +44 20 7107 0611. From Sweden, +46 8 5069
2105, and from the rest of Europe, +41 91 610 56 00. Lines will be open 15
minutes before the start of the conference. Audio playback of the call will
start one hour after the call ends and will be available for 96 hours: Playback
numbers: +44 20 7108 6233 (U.K.), +41 91 612 4330 (rest of Europe) or +1 866 416
2558 (U.S./Canada). The code is 18172, followed by the # key.
A conference call for analysts and investors is scheduled to begin today at 3:00
p.m. CET (10:00 a.m. EDT). Callers should dial +1 412 858 4600 (from the
U.S./Canada) or +41 91 610 5600 (Europe and the rest of the world). Callers are
requested to phone in 15 minutes before the start of the call. The audio
playback of the call will start one hour after the end of the call and be
available for two weeks. Playback numbers: +1 866 416 2558 (U.S./Canada) or +41
91 612 4330 (Europe and the rest of the world). The code is 10636, followed by
the # key.
+--------------------------------------------+-------------------------------+
| Investor calendar 2010 | |
+--------------------------------------------+-------------------------------+
| Q4 2009 results | Feb. 18, 2010 |
+--------------------------------------------+-------------------------------+
| Q1 2010 results | April 22, 2010 |
+--------------------------------------------+-------------------------------+
| Annual General Meeting of shareholders | April 26, 2010 |
+--------------------------------------------+-------------------------------+
| Q2 2010 results | July 22, 2010 |
+--------------------------------------------+-------------------------------+
| Q3 2010 results | Oct. 28, 2010 |
+--------------------------------------------+-------------------------------+
ABB (www.abb.com) is a leader in power and automation technologies that enable
utility and industry customers to improve performance while lowering
environmental impact. The ABB Group of companies operates in around 100
countries and employs about 120,000 people.
Zurich, Oct. 29, 2009
Joe Hogan, CEO
Important notice about forward-looking information
This press release includes forward-looking information and statements including
the sections entitled "Cost reductions," "Outlook, and "Compliance," as well as
other statements concerning the outlook for our business. These statements are
based on current expectations, estimates and projections about the factors that
may affect our future performance, including global economic conditions, 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" or similar expressions. However, there are many 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 press release 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 related to the financial
crisis and economic slowdown, costs associated with compliance activities, the
amount of revenues we are able to generate from backlog and orders received, raw
materials prices, 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.
For more information please contact:
Investor Relations:
Switzerland: Tel. +41 43 317 7111
Sweden: Tel. +46 21 325 000
USA: Tel. +1 203 750 7743
investor.relations@ch.abb.com
ABB Q3 and nine-months (9M) 2009 key figures
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| $ millions unless | Q3 09 | Q3 08 | Change | 9M 09 | 9M 08 | Change |
| otherwise indicated | | | | | | |
+----------------------------+--------+-------+--------------+---------+---------+--------------+
| | | | | US$ | Local | | | US$ | Local |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| Orders | Group | 7,060 | 8,885 | -21% | -15% | 23,519 | 31,099 | -24% | -15% |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Power Products | 2,553 | 3,409 | -25% | -21% | 8,273 | 11,012 | -25% | -16% |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Power Systems | 1,991 | 1,293 | 54% | 70% | 5,967 | 5,952 | 0% | 17% |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Automation | 2,033 | 2,741 | -26% | -22% | 6,392 | 8,778 | -27% | -20% |
| | Products | | | | | | | | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Process | 1,145 | 1,969 | -42% | -39% | 4,912 | 7,205 | -32% | -23% |
| | Automation | | | | | | | | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Robotics | 169 | 400 | -58% | -56% | 557 | 1,359 | -59% | -55% |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Corporate | (831) | (927) | | | (2,582) | (3,207) | | |
| | (consolidation) | | | | | | | | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| Revenues | Group | 7,910 | 8,791 | -10% | -5% | 23,034 | 25,772 | -11% | -1% |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Power Products | 2,823 | 3,034 | -7% | -2% | 8,130 | 8,682 | -6% | 3% |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Power Systems | 1,612 | 1,601 | 1% | 7% | 4,641 | 5,010 | -7% | 4% |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Automation | 2,234 | 2,612 | -14% | -10% | 6,482 | 7,766 | -17% | -8% |
| | Products | | | | | | | | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Process | 1,809 | 1,920 | -6% | 0% | 5,439 | 5,727 | -5% | 7% |
| | Automation | | | | | | | | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Robotics | 211 | 431 | -51% | -49% | 739 | 1,235 | -40% | -34% |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Corporate | (779) | (807) | | | (2,397) | (2,648) | | |
| | (consolidation) | | | | | | | | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| EBIT | Group | 1,419 | 1,291 | 10% | | 3,328 | 4,093 | -19% | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Power Products | 477 | 536 | -11% | | 1,474 | 1,656 | -11% | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Power Systems | 117 | 113 | 4% | | 322 | 411 | -22% | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Automation | 340 | 491 | -31% | | 979 | 1,486 | -34% | |
| | Products | | | | | | | | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Process | 164 | 218 | -25% | | 486 | 686 | -29% | |
| | Automation | | | | | | | | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Robotics | (36) | 28 | n/a | | (108) | 82 | n/a | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Corporate | 357 | (95) | | | 175 | (228) | | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| EBIT | Group | 17.9% | 14.7% | | | 14.4% | 15.9% | | |
| margin | | | | | | | | | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Power Products | 16.9% | 17.7% | | | 18.1% | 19.1% | | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Power Systems | 7.3% | 7.1% | | | 6.9% | 8.2% | | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Automation | 15.2% | 18.8% | | | 15.1% | 19.1% | | |
| | Products | | | | | | | | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Process | 9.1% | 11.4% | | | 8.9% | 12.0% | | |
| | Automation | | | | | | | | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
| | Robotics | -17.1% | 6.5% | | | -14.6% | 6.6% | | |
+----------+-----------------+--------+-------+------+-------+---------+---------+------+-------+
Q3 2009 orders received and revenues by region
+----------------+--------+--------+------+-------+--------+-------+-------+-------+
| $ millions |Orders received | Change | Revenues | Change |
+----------------+-----------------+--------------+----------------+---------------+
| | Q3 09 | Q3 08 | US$ | Local | Q3 09 | Q3 08 | US$ | Local |
+----------------+--------+--------+------+-------+--------+-------+-------+-------+
| Europe | 2,624 | 3,803 |-31% | -25% | 3,371 | 4,072 | -17% | -10% |
+----------------+--------+--------+------+-------+--------+-------+-------+-------+
| Americas | 1,723 | 1,845 | -7% | 4% | 1,495 | 1,571 | -5% | 0% |
+----------------+--------+--------+------+-------+--------+-------+-------+-------+
| Asia | 1,864 | 2,512 |-26% | -24% | 2,177 | 2,266 | -4% | 0% |
+----------------+--------+--------+------+-------+--------+-------+-------+-------+
| Middle East | 849 | 725 | 17% | 20% | 867 | 882 | -2% | 0% |
| and Africa | | | | | | | | |
+----------------+--------+--------+------+-------+--------+-------+-------+-------+
| Group total | 7,060 | 8,885 |-21% | -15% | 7,910 | 8,791 | -10% | -5% |
+----------------+--------+--------+------+-------+--------+-------+-------+-------+
Reconciliation of non-GAAP financial measures regarding Q3 2009
($ millions, unaudited)
+-----------------------------------------------------------+----------+
| EBIT margin | |
+-----------------------------------------------------------+----------+
| Earnings before interest and taxes (EBIT) | 1,419 |
+-----------------------------------------------------------+----------+
| Revenues | 7,910 |
+-----------------------------------------------------------+----------+
| EBIT margin (EBIT as % of revenues) | 17.9% |
+-----------------------------------------------------------+----------+
| | |
+-----------------------------------------------------------+----------+
| Net cash | |
+-----------------------------------------------------------+----------+
| Short-term debt and current maturities of long-term debt | (218) |
+-----------------------------------------------------------+----------+
| Long-term debt | (2,219) |
+-----------------------------------------------------------+----------+
| Total debt | (2,437) |
+-----------------------------------------------------------+----------+
| | |
+-----------------------------------------------------------+----------+
| Cash and equivalents | 5,502 |
+-----------------------------------------------------------+----------+
| Marketable securities and short-term investments | 2,779 |
+-----------------------------------------------------------+----------+
| Cash and marketable securities | 8,281 |
+-----------------------------------------------------------+----------+
| Net cash | 5,844 |
+-----------------------------------------------------------+----------+
EBIT margin is calculated by dividing EBIT by revenues. Management believes EBIT
margin is a useful measure of profitability and uses it as a performance target.
Net cash is a financial measure that is calculated as the total of cash and
equivalents, marketable securities and short-term investments minus our total
debt.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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