ABB Group Results - First Three Months 1999.ZURICH, Switzerland--(BUSINESS WIRE)--April 21, 1999-- Net income stronger, outlook maintained for 1999 -- Net income up 17 percent -- Revenues up 11 percent -- Earnings per share up 17 percent for ABB n. 1. Among weavers, yarn for the warp. Hence, Noun 1. ABB - an urban hit squad and guerrilla group of the Communist Party in the Philippines; formed in the 1980s AB and 12 percent for ABB AG ABB, the international engineering and technology group, said today its first-quarter net income rose to $302 million, up 17 percent compared to the same period last year supported by increased revenues and a stronger operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: . US$ in millions Jan - Mar Jan - Mar % change unless otherwise stated 1999 1998 Orders Received 8,823 8,447 + 4 % Revenues 6,891 6,206 + 11 % Operating Earnings after Depreciation 534 454 + 18 % Net Income 302 258 + 17 % ABB AB Net Income per share SEK 1.29 SEK 1.10 + 17 % ABB AG Net Income per bearer share CHF 23.55 CHF 21.10 + 12 % First quarter operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before after depreciation reached $534 million, an increase of 18 percent compared to the same period last year (1998: $454 million). The higher earnings reflect both increased revenues and continued success in lowering ABB's cost base. Power Transmission, Power Distribution and Products and Contracting contributed with the strongest percentage increases. Oil, Gas and Petrochemicals also increased its earnings and Financial Services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. reached the same high level as last year. Automation showed overall higher operating earnings with a neutral impact on earnings from Elsag Bailey Bailey may refer to:
In the United Kingdom:
"This result confirms our strategy to transform ABB into a company delivering more knowledge- and service-based solutions, with fewer heavy assets, higher operating margins and a better return on investments," said ABB President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , Goran This article is about the Slavic name. For the Swedish name, see Göran. For other uses, see Goran (disambiguation). Goran may refer to: First name
This page or section lists people with the surname Lindahl. . "Based on what we see in the first quarter, we confirm our full-year outlook with net income expected to exceed the level of 1998." ABB's parent companies' net income per share were higher, up 17 percent for ABB AB to SEK SEK In currencies, this is the abbreviation for the Swedish Krona. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 1.29 and 12 percent higher for ABB AG bearer shares Bearer share Security not registered on the books of the issuing corporation and thus payable to possessor of the shares. Negotiable without endorsement and transferred by delivery, thus avoiding some of the control associated with ordinary shares. to CHF CHF In currencies, this is the abbreviation for the Swiss Franc. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 23.55. ABB started the process to establish a new single-class share structure for the Group to replace the present four classes of shares. Orders received for the first quarter increased by 4 percent to $8,823 million (1998: $8,447 million(1)). Almost all segments reported increased orders compared to the previous year. Demand for standard products (base orders) was in line with expectations and 4 percent lower compared to last year. Large orders received in the first quarter increased by 13 percent, including a high-voltage adj. 1. having, operating on, or powered by high voltage; as, a high-voltage generator; a high-voltage line s>. 2. same as high-powered. Adj. 1. power transmission link in China and gas-fired gas-fired adj → de gas gas-fired adj → au gaz gas-fired adj (heater etc) → Gas- combined-cycle power plants in the U.K., Japan and Australia Australia (ôstrāl`yə), smallest continent, between the Indian and Pacific oceans. With the island state of Tasmania to the south, the continent makes up the Commonwealth of Australia, a federal parliamentary state (2005 est. pop. . Orders received increased by 70 percent in Asia compared to the first quarter of last year. Orders received in the Americas A·mer·i·cas , the See America. also developed strongly. In Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). , orders were on the same
level as last year. As expected, orders received in the first quarter
did not reach the previous year's exceptionally high level in the
Middle East and Africa.Overall, growth in industrial production continued to be slow in several industrialized in·dus·tri·al·ize v. in·dus·tri·al·ized, in·dus·tri·al·iz·ing, in·dus·tri·al·iz·es v.tr. 1. To develop industry in (a country or society, for example). 2. and emerging countries. Europe showed some demand growth in certain industries, but only to a limited extent in the area of industrial products. Industrial demand remained mixed in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. for sectors such as automotive, pulp and paper, chemical, petrochemical petrochemical, any one of a large group of chemicals derived from a component of petroleum or natural gas. The cracking processes for manufacturing gasoline produce vast quantities of gaseous hydrocarbons. , steel, and oil mainly due to low commodity prices. On the other hand, industries such as power generation and distribution benefited from deregulation Deregulation The reduction or elimination of government power in a particular industry, usually enacted to create more competition within the industry. Notes: Traditional areas that have been deregulated are the telephone and airline industries. . Economies in South America South America, fourth largest continent (1991 est. pop. 299,150,000), c.6,880,000 sq mi (17,819,000 sq km), the southern of the two continents of the Western Hemisphere. softened soft·en v. soft·ened, soft·en·ing, soft·ens v.tr. 1. To make soft or softer. 2. To undermine or reduce the strength, morale, or resistance of. 3. and infrastructure projects were postponed. Some Southeast Southeast or south east is the ordinal direction halfway between south and east. It the opposite of northwest. Southeast or South East can refer to: Asian nation country, land, state - the territory occupied by a nation; "he returned to the land of his birth"; "he visited several European countries" showed signs of improvement and markets in the Middle East and Africa continued to develop positively. Revenues for the first quarter increased by 11 percent to $6,891 million (1998: $6,206 million). Practically all segments contributed to that increase. The order backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. - an indicator Indicator Anything used to predict future financial or economic trends. Notes: In the context of technical analysis, an indicator is a mathematical calculation based on a securities price and/or volume. The result is used to predict future prices. of future revenues - at the end of March reached $27,523 million (March 31, 1998: $27,267 million). In spite of in opposition to all efforts of; in defiance or contempt of; notwithstanding. See also: Spite higher interest expense related to the financing of the Elsag Bailey acquisition, income before taxes for the first three months improved to $429 million (1998: $380 million), an increase of 13 percent. Net income for the first three months increased by 17 percent to $302 million compared to the same period last year (1998: $258 million). Following the financing of Elsag Bailey Process Automation, return on capital employed Return on capital employed (ROCE) Indicator of profitability of the firm's capital investments. Determined by dividing Earnings Before Interest and Taxes by (capital employed plus short-term loans minus intangible assets). reached 15.7 percent (March 31, 1998: 16.7 percent). ABB's net cash position (defined as cash and cash equivalents minus short-, medium-, and long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. loans) at the end of the first quarter of 1999 was $-1,621 million (March 31, 1998: $715 million). This figure includes the effects of the acquisition of Elsag Bailey Process Automation, dividend payments to ABB's parent companies earlier than last year and cash compensation from DaimlerChrysler for the 50-percent-stake in Adtranz. ABB's shift into businesses with higher knowledge and service content continued with major transactions during the first quarter. The acquisition of Elsag Bailey Process Automation was completed after receiving all of the necessary approvals and is reflected in this report. ABB also divested its stake in Adtranz and last year's figures have been adjusted for this transaction. ABB and ALSTOM Alstom (formerly GEC-Alsthom) (Euronext: ALO) is a large French multinational conglomerate whose businesses are power generation, railway signalling; and manufacturing trains (e.g. the TGV and Eurostar as well as Citadis trams) and the world's largest ships (e.g. announced the intention to merge See mail merge and concatenate. their power generation businesses in a 50-50 joint company to be called ABB ALSTOM POWER, subject to the customary approvals. The first quarter is not affected by this planned transaction. As of March 31, 1999, ABB employed 209,353 people compared to 199,232 at yearend 1998, including 11,000 employees from Elsag Bailey Process Automation. ABB has adopted the revised International Accounting Standard (IAS See iPlanet Application Server. 1. (computer) IAS - The first modern computer. It had main registers, processing circuits, information paths within the central processing unit, and used Von Neumann's fetch-execute cycle. ) related to pension accounting as from the beginning of 1999. A total amount of $1,006 million has been directly reflected in the balance sheet as pension liabilities Pension liabilities Future liabilities resulting from pension commitments made by a corporation. Accounting for pension liabilities varies widely by country. . The equivalent amount after consideration of deferred taxes, amounting to $889 million, has been charged to equity. As a result of higher net income and the mentioned accounting changes, return on equity reached 23.3 percent (March 31, 1998: 19.3 percent). ABB, with its focus on industrial solutions, is typically late in the business cycle and therefore the general market environment for ABB's products and systems is not expected to improve until next year. For the full year of 1999, net income is expected to exceed the level of 1998. (1) Note: Unless stated otherwise, all references to 1998 figures refer to the first three months. 1998 figures are adjusted to reflect the sale of ABB's 50-percent share in Adtranz, see Note 7 to the Financial Statements. 1999 figures include Elsag Bailey Process Automation acquired in January January: see month. 1999. -0-
ABB Group
Consolidated Income Statement
(US$ in millions) Year to date
January - March
1999 1998
Revenues 6,891 6,206
Material expenses -3,103 -2,741
Personnel expenses -2,388 -2,174
Other expenses -1,134 -1,065
Changes in work in progress and finished goods 488 447
Depreciation of fixed assets -256 -224
Unusual items 36 5
Operating Earnings after Depreciation 534 454
Earnings from equity accounted companies -2 -1
Dividend income 3 1
Interest income 76 94
Interest expense -184 -168
Exchange differences 2 0
Income before Taxes 429 380
Income taxes -126 -123
Net Income before Minority Interests 303 257
Minority interests -1 1
Net Income 302 258
ABB Group
Condensed Consolidated Balance Sheet
(US$ in millions) Notes March 31 March 31 December 31
1999 1998 1998
Assets
Cash and cash equivalents 7,625 7,880 7,790
Other current assets 15,896 13,830 15,080
Fixed assets 11,125 8,791 9,513
Total Assets 34,646 30,501 32,383
Liabilities and Equity
Current liabilities 4 21,204 17,995 17,883
Non-current liabilities 4 8,732 6,751 8,226
Minority interests 292 314 315
Stockholders' equity 4,418 5,441 5,959
Total Liabilities and Equity 34,646 30,501 32,383
Condensed Statement of Changes in Equity
(US$ in millions) Note January - March
1999 1998
Equity as of December 31, previous year 5,959 5,283
Changes in accounting principles
and other items 2 -921 +36(1)
Dividend payments to ABB AB and ABB AG -498 -
Translation differences -424 -136
Net income (3 months) 302 258
Equity as of March 31 4,418 5,441
(1) Introduction of revised IAS 12 on Income Taxes.
ABB Group
Condensed Consolidated Statement of Cash Flows
(US$ in millions) Year to date
January - March
1999 1998
Cash flow from Operating Activities:
Income before taxes 429 380
Adjustments of earnings to cash -94 -17
Change in net working capital -561 -546
Taxes paid -90 -116
Cash Flow from Operating Activities -316 -299
Cash Flow related to Investing Activities(1) -1,171 -147
Cash Flow related to Financing Activities(2) 1,526 2,753
Effects of translation differences on cash
and cash equivalents -204 144
Net Change in Cash and Cash Equivalents -165 2,451
Cash and cash equivalents - beginning of year 7,790 5,790
Cash and cash equivalents - end of interim period 7,625 8,241
(1) 1999 figure includes $1,534 million paid for the acquisition of
Elsag Bailey Process Automation and compensation for the sale of
the 50-percent share in Adtranz.
(2) The first quarter 1999 contains dividend payments to the parent
companies of $498 million whereas in 1998 the corresponding
payments were made in the second quarter.
ABB Group
Notes to the Consolidated Financial Statements
Note 1, General
The Group's accounting principles, based on International
Accounting Standards (IAS) and applied in the interim report for the
first quarter 1999, are described in the 1998 year-end Financial
Statements of ABB, except for the introduction of revised IAS 19,
Employee Benefits (refer to Note 2). The interim report and notes are
unaudited.
1998 figures are adjusted to reflect the sale of ABB's 50-percent
share in Adtranz, see Note 7 to the Financial Statements. 1999 figures
include Elsag Bailey Process Automation acquired in January 1999.
Note 2, Introduction of Revised IAS 19 on Employee Benefits
ABB has adopted the revised IAS 19 as from January 1, 1999.
Related transition effects amounting to a total of $1,006 million
have been directly reflected in the balance sheet in the position
pension liabilities. The transition effects represent remaining
unamortized benefit obligations under the original IAS 19 and
reevaluations in connection with changes of actuarial assumptions
under revised IAS 19. The equivalent amount after consideration of
deferred taxes - amounting to $889 million - has been charged to
equity as a change in accounting principles (refer to Statement of
Changes in Equity).
The following is a summary of main items considered at January 1,
1999 for the transition to the revised IAS 19.
(US$ in millions)
Previously unrecognized actuarial losses (net) 652
Previously unrecognized past service costs 97
Other previously unrecognized obligations (mainly medicare) 257
Total increase of pension liabilities and similar 1,006
Deferred taxes -117
Net change from transition to revised IAS 19 889
Note 3, Geographic and Segment Information
Data per Region
(US$ in millions) Orders Received Revenues
Period January - March January - March
1999 1998 1999 1998
Europe 4,115 4,085 3,470 3,331
The Americas 2,462 1,866 1,831 1,359
Asia 1,649 970 884 930
Middle East and Africa 597 1,526 706 586
Total 8,823 8,447 6,891 6,206
Data Orders Revenues Operating Earnings
per Business Segment Received after Depreciation
(US$ in millions)
Period January- January - January -
March March March
1999 1998 1999 1998 1999 1998
Power Generation 2,312 2,177 1,653 1,489 12 24
Power Transmission 1,127 902 870 781 70 57
Power Distribution 833 729 588 584 30 24
Automation 2,251 1,809 1,815 1,545 114 105
Oil, Gas and
Petrochemicals 802 1,019 680 519 37 35
Products and
Contracting 1,746 1,706 1,471 1,391 78 67
Financial Services 161 164 161 164 89 90
Various Activities/
Corporate 526 778 448 439 104 52
Total 9,758 9,284 7,686 6,912 534 454
Intra-Group
transactions -935 -837 -795 -706 -- --
Net Total 8,823 8,447 6,891 6,206 534 454
Note: 1998 orders received and revenue figures exclude ABB's 50-
percent share of Adtranz. 1999 figures include the figures for
Elsag Bailey Process Automation acquired in January 1999 (see
Note 6) and the $41 million capital gain for the sale of Adtranz.
Note 4, Short-, medium-, long-term loans
(US$ in millions) March 31 March 31 December 31
1999 1998 1998
Loans
Short-term loans 6,704 4,692 3,409
Medium- and long-term loans 2,542 2,473 2,808
Total loans 9,246 7,165 6,217
Note 5, Main Exchange Rates
Average As of As of
January-March December 31 March 31
1999 1998 1998 1999 1998
Euro (1998:ECU) US$ 1.00 0.89 0.92 0.86 0.93 0.93
= XEU
German mark US$ 1.00 1.75 1.82 1.68 1.82 1.85
= DEM
Swedish krona US$ 1.00 8.08 7.99 8.13 8.24 7.97
= SEK
Swiss franc US$ 1.00 1.43 1.48 1.38 1.48 1.52
= CHF
For the first three months of 1999, changes in exchange rates had
negligible effects on the reported profit and loss accounts compared
to the same period last year. The balance sheet figures were reduced
on average by 5 percent due to the strengthening of the dollar when
compared to December 31, 1998 and 2 percent when comparing to March
31, 1998.
Note 6, Effects of the integration of Elsag Bailey Process
Automation
In January 1999, ABB completed the acquisition of Elsag Bailey
Process Automation. The total purchase price was comprised of $1,534
million related to the purchase of shares and $648 million related to
the acquired debt. ABB owns more than 99 percent of the outstanding
share capital of Elsag Bailey on a fully diluted basis. The Elsag
Bailey business is part of the Automation segment and is included in
the 1999 accounts using the purchase method of accounting. As a
condition of the U.S. Federal Trade Commission and the European
Commission approval, ABB has agreed to divest Elsag Bailey's gas
chromatograph and mass spectrometer business. This business, whose
main location is in Bartlesville, Oklahoma, has annual revenues of
about $50 million and employs some 340 people.
The goodwill related to the acquisition of Elsag Bailey Process
Automation amounted to $2,035 million of which $420 million was
carried in Elsag Bailey's books at December 31, 1998 and $1,615
million originated from the acquisition.
Note 7, Effects of the discontinuation of the ABB Daimler-Benz
Transportation Group (Adtranz)
Following the discontinuation of the Adtranz business in the 1998
year-end accounts, figures for the first quarter 1998 have been
restated to exclude Adtranz from the ABB Group consolidation and the
segment presentation, except for earnings (see Note 3). The comparison
with previous year's figures is as follows:
(US$ in millions) January - March, January - March,
1998 1998
as restated 1999 as reported 1998
Order backlog 27,267 32,598
Orders received 8,447 9,008
Revenues 6,206 6,513
Operating earnings after 454 454
depreciation
Income before taxes 380 380
Net income 258 258
Note 8, Formation of ABB ALSTOM POWER ABB has announced on March 23, 1999 the merger of its power generation business (excluding its nuclear and distributed power businesses) with the corresponding business of ALSTOM in a 50-50 joint company called ABB ALSTOM POWER. The final formation of the company is subject to customary approvals and expected to be completed within 3-4 months from the date of the announcement. The first quarter 1999 accounts are not affected by this transaction. Parent Companies Financial Results ABB AB (Sweden Sweden, Swed. Sverige, officially Kingdom of Sweden, constitutional monarchy (2005 est. pop. 9,002,000), 173,648 sq mi (449,750 sq km), N Europe, occupying the eastern part of the Scandinavian peninsula. ) and ABB AG (Switzerland Switzerland (swĭt`sərlənd), Fr. Suisse, Ger. Schweiz, Ital. Svizzera, officially Swiss Confederation, federal republic (2005 est. pop. 7,489,000), 15,941 sq mi (41,287 sq km), central Europe. ) are the two sole owners in equal parts of ABB Asea Brown Boveri ABB, formerly Asea Brown Boveri, is a multinational corporation headquartered in Zürich, Switzerland, operating mainly in the power and automation technology areas. ABB is one of the largest engineering companies as well as one of the largest conglomerate companies in the Ltd, Zurich (Switzerland), which is the holding company of the ABB Group. Their income and stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. come from their respective 50-percent shares of the ABB Group income and equity. ABB Companies throughout the world report their financial results in local currencies, which are then translated to U.S. dollars to establish the ABB Group's consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: accounts. For a full report on the development of the ABB Group, please refer to the first part of this report. In order to compute To perform mathematical operations or general computer processing. For an explanation of "The 3 C's," or how the computer processes data, see computer. the income of the two parent companies, ABB AB (Sweden) and ABB AG (Switzerland), their 50-percent shares of ABB Group income are translated from U.S. dollars to Swedish krona Noun 1. Swedish krona - the basic unit of money in Sweden krona Swedish monetary unit - monetary unit in Sweden ore - a monetary subunit in Denmark and Norway and Sweden; 100 ore equal 1 krona (SEK) and Swiss francs Noun 1. Swiss franc - the basic unit of money in Switzerland franc - the basic monetary unit in many countries; equal to 100 centimes centime - a fractional monetary unit of several countries: France and Algeria and Belgium and Burkina Faso and Burundi and (CHF), respectively. Parent Companies Financial Results First Three Months ABB AB (Sweden) and associated company associated company associate n → Partnerfirma f associated company n → società collegata ABB AB and associated company ABB AB's share of ABB Group income before taxes and after minority interests for the first three months of 1999 was US$213 million, an increase of 12 percent (1998: US$190 million). The average rate of the U.S. dollar has increased slightly against the Swedish krona which had a positive effect when translating ABB AB's share in ABB Group earnings into Swedish krona. After translation, ABB AB's share of ABB Group earnings before taxes and after minority interests increased to SEK 1,725 million (1998: SEK 1,518 million). ABB AB's income before taxes, including associated company, amounted to SEK 1,722 million, an increase of 14 percent (1998: SEK 1,517 million). Net income amounted to SEK 1,217 million, an increase of 18 percent (1998: SEK 1,029 million). ABB AB's net income per share amounted to SEK 1.29 (1998: SEK 1.10). ABB AB, parent company Net income amounted to SEK -3 million (1998: SEK -1 million). The dividend for the fiscal year 1998 was anticipated in the 1998 accounts. Note: The results for the first six months of 1999 of ABB Group will be published on July July: see month. 21, 1999 and the full year results for 1999 on February February: see month. 3, 2000. The Annual General Meeting of ABB will take place on March 16, 2000.
ABB AB and Associated Company (1)
Condensed Income Statement
(SEK in millions) January -
March
1999 1998
Administrative expenses -5 -3
Share in ABB Group income before taxes
and after minority interests 1,725 1,518
Interest income 2 2
Interest expense 0 0
Income before taxes 1,722 1,517
Income taxes -505 -488
Net income 1,217 1,029
Basic and diluted earnings per share (in SEK):
- Series A shares 1.29 1.10
- Series B shares 1.29 1.10
ABB AB and Associated Company (1)
Condensed Balance Sheet
(SEK in millions) March 31 March 31 December 31
1999 1998 1998
Assets
Shares and participations 18,202 21,682 24,223
Financing receivables - 1 -
Other current receivables 716 3 2
Cash and cash equivalents 1,466 184 140
Total Assets 20,384 21,870 24,365
Liabilities and Equity
Stockholders' equity 18,336 21,866 24,363
Short-, medium- and long-term 2,046 4 2
loans
Accrued expenses 2 0 0
Total Liabilities and Equity 20,384 21,870 24,365
(1) ABB AB's participation in the ABB Group recognized according to
the equity method.
ABB AB and Associated Company (1)
Condensed Statement of Changes in Equity
(SEK in millions) January - March
1999 1998
Equity as of December 31, previous year 24,363 21,053
Changes in accounting principles and other items -3,794 143
Dividends -2,045 -
Translation differences -1,405 -359
Net income (3 months) 1,217 1,029
Equity as of March 31 18,336 21,866
ABB AB and Associated Company 1)
Condensed Statement of Cash Flows
(SEK in millions) January - March
1999 1998
Cash flow from Operating Activities:
Income before taxes 1,722 1,517
Adjustment for earnings in equity
accounted companies 108 -1,030
Change in net working capital 1 -1
Taxes paid -505 -488
Cash Flow from Operating Activities 1,326 -2
Cash Flow from Investing Activities 0 0
Cash Flow from Financing Activities 0 0
Net Change in Cash and Cash Equivalents 1,326 -2
Cash and cash equivalents - beginning of year 140 186
Cash and cash equivalents - end of interim period 1,466 184
(1) ABB AB's participation in the ABB Group recognized according to
the equity method.
ABB AB Notes to the Financial Statements
Auditors' Examination
The interim report and notes are unaudited.
Earnings per Share
Number of shares outstanding and fully diluted:
668,197,570 Series A shares of SEK 5 nominal value
269,715,450 Series B shares of SEK 5 nominal value
Parent Companies Financial Results First Three Months
ABB AG (Switzerland) and associated company
ABB AG and associated company
ABB AG's share of ABB Group income before taxes and after
minority interests for the first three months of 1999 was US$213
million, an increase of 12 percent (1998: US$190 million). The average
rate of the U.S. dollar has weakened slightly against the Swiss franc
which had a negative effect when translating ABB AG's share in ABB
Group earnings into Swiss franc. After translation, ABB AG's share of
ABB Group earnings before taxes and after minority interests increased
to CHF 305 million (1998: CHF 281 million). ABB AG's income before
taxes, including associated company, amounted to CHF 308 million, an
increase of 8 percent (1998: CHF 286 million). Net income amounted to
CHF 218 million, an increase of 12 percent (1998: CHF 195 million).
ABB AG's net income per bearer share amounted to CHF 23.55 (1998:
CHF 21.10).
ABB AG, parent company
Net income amounted to CHF 2 million (1998: CHF 4 million). The
dividend for the fiscal year 1998 was anticipated in the 1998
accounts.
ABB AG and Associated Company (1)
Condensed Income Statement
(CHF in millions) January - March
1999 1998
Share of ABB Group income before taxes
and after minority interests 305 281
Other income items 4 7
Expenses -1 -2
Income before taxes 308 286
Income taxes -90 -91
Net income 218 195
Basic and diluted earnings per share (in CHF):
- Bearer shares 23.55 21.10
- Registered shares 4.71 4.22
(1) ABB AG's participation in the ABB Group accounted for according
to the equity method.
ABB AG and Associated Company (1)
Condensed Balance Sheet
(CHF in millions) March 31 March 31 December 31
1999 1998 1998
Assets
Cash and cash equivalents 537 450 290
Other current receivables 137 11 11
Shareholding in ABB Asea
Brown Boveri Ltd 3,269 4,135 4,111
Other fixed assets 9 15 15
Total Assets 3,952 4,611 4,427
Liabilities and Equity
Short-, medium- and
long-term loans 0 150 0
Other liabilities 390 12 16
Stockholders' equity 3,562 4,449 4,411
Total Liabilities and Equity 3,952 4,611 4,427
ABB AG and Associated Company (1)
Condensed Statement of Changes in Equity
(CHF in millions) January - March
1999 1998
Equity as of December 31, previous year 4,411 4,140
Changes in accounting principles and other items -681 27
Dividends -379 -
Translation differences -7 87
Net income (3 months) 218 195
Equity as of March 31 3,562 4,449
(1) ABB AG's participation in the ABB Group accounted for according
to the equity method.
ABB AG and Associated Company 1)
Condensed Statement of Cash Flows
(CHF in millions) January - March
1999 1998
Cash flow from Operating Activities:
Income before taxes 308 286
Adjustment for earnings (equity accounted company) -305 -281
Change in net working capital 240 -3
Taxes paid -2 -2
Cash Flow from Operating Activities 241 0
Cash Flow from Investing Activities 6 0
Cash Flow from Financing Activities 0 0
Net Change in Cash and Cash Equivalents 247 0
Cash and cash equivalents - beginning of 290 450
year
Cash and cash equivalents - end of interim 537 450
period
(1) ABB AG's participation in the ABB Group accounted for according
to the equity method.
ABB AG Notes to the Financial Statements
Auditors' Examination
The interim report and notes are unaudited.
Earnings per Share
Number of shares outstanding and fully diluted:
8,159,470 Bearer shares of CHF 50 nominal value
5,470 750 Registered shares of CHF 10 nominal value
The ABB Group results for the first six months of 1999 will be
published on July 21, 1999 and the full year results for 1999 on
February 3, 2000. The next Annual General Meeting of ABB will take
place on March 16, 2000 in Switzerland.
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