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ABB ASEA BROWN BOVERI GROUP REPORTS ORDER INTAKE UP 18 PERCENT -- SUMMARY OF THE SIX-MONTH REPORT 1992

 ABB ASEA BROWN BOVERI GROUP REPORTS ORDER INTAKE UP 18 PERCENT --
 SUMMARY OF THE SIX-MONTH REPORT 1992
 ZURICH, Aug. 26 /PRNewswire/ -- Orders received by the ABB Group for the first six months of 1992 totaled $17.1 billion, an increase of 18 percent compared to the corresponding period in 1991 ($14.5 billion). The order backlog at the end of the reporting period totaled $30.3 billion, which is 23 percent higher than a year ago ($24.6 billion).
 Market Conditions and Sales
 The largest order in the reporting period came from Abu Dhabi for a combined steam power station and sea-water desalination plant. Other large orders were received from a number of countries for various types of power plants, railway equipment for Korea, and HVDC transmission equipment for a subsea cable between Sweden and Germany.
 The sluggish economy in most parts of the world continues to affect most industries and thus ABB. Standard products for industry and construction as well as industrial investment goods experienced stagnation overall and weaker demand in some cases. This had a short- term negative impact on capacity utilization. At the same time, ABB achieved a very strong intake of large orders for energy, transportation and industry infrastructure projects, including in Asia, where ABB's expansion is continuing. The effect of currency translation on the 1992 figures was minimal.
 Except for Environmental Control and Financial Services, ABB's Business Segments recorded higher order intake during the first half of 1992.
 Revenues amounted to $13.8 billion, an increase of 2 percent compared to $13.6 billion for the first six months of 1991.
 Earnings
 ABB Group earnings after financial items and before nonrecurring items and taxes remained virtually unchanged at $518 million (first six months 1991: $520 million). Operating earnings after depreciation were identical to last year at $897 million.
 Power plants reported increased earnings, where as Environmental Control showed a decrease. The other Business Segments only recorded small changes compared with the corresponding period in 1991. This means that ABB, during the second year of recession in most countries, has managed to prevent an erosion of its margins.
 In North America continued gains resulting from restructuring have been offset by the impact of the recession on sales volumes and prices. Germany, Italy, Switzerland and most Asian countries showed earnings improvements. In the Nordic region, where ABB has major activities, the particularly severe recession has led to reduced earnings.
 Net interest expense, excluding interest on advances, improved in the first half of 1992. This reflects an improved net debt position at the end of the reporting period compared to a year ago. Net debt is roughly at the same level as at the end of 1991.
 ABB started to reduce costs and personnel early in the downturn of the business cycle. These measures, together with restructuring projects in North America and several countries in Europe, have so far offset the negative impact of the recession on volumes and margins.
 Nonrecurring items, mainly restructuring costs and gains from divestments, resulted in a net cost of -$22 million (first six months 1991 net gain of $16 million).
 Income before taxes decreased by 7 percent to $496 million (first half year 1991: $536 million).
 Investments, Divestments and Capital Expenditure
 The expenses for acquisitions in the first half of 1992 were roughly equal to the funds generated by divestments.
 The expansion in Eastern European markets continues with new companies being established in the Baltic States, Ukraine, Romania and Poland. The Central and Eastern European companies are increasingly integrated in ABB's global network and are also included in ABB's ongoing restructuring programs in Europe.
 ABB increased its ownership in BREL, the largest manufacturer of rolling stock in Great Britain from 40 to 80 percent.
 A successful tender offer worth approximately $30 million has increased ABB's ownership in ABB Tecnomasio in Italy to 99 percent. ABB sold Metrawatt GmbH, a company in Germany with annual turnover of $70 million.
 Group capital expenditure for tangible fixed assets was $373 million for the first six months of 1992 (first half 1991: $421 million).
 Personnel and Organization
 The number of employees decreased to 209,000 at the end of the reporting period, down by 14,000 from a year ago and 5,000 less than at the end of 1991. Excluding acquisitions and divestitures, personnel figures were reduced by some 7,000 during the first half of 1992. This reduction will continue in the second half of 1992 to further adjust capacity to demand, and also as a result of restructuring programs designed to ensure long-term competitiveness.
 Outlook for the Remainder of 1992
 To date, ABB has not experienced any upturn in demand in the recessionary markets, and no improvement in demand is expected in the second half of this year in the industrialized countries. However, a continued expansion in Asia is anticipated.
 Due to the ongoing recession, some business areas are exposed to increased price pressure and lower volumes, although many ABB units have been streamlined to operate profitably under such adverse conditions. Continuing restructuring projects also impact positively on results.
 Earnings after financial items for 1992 are expected to reach about last year's level.
 REVENUES PER REGION (A)
 (US$ in millions)
 Six months Pct of Six Months Pct of
 1992 Total 1991 Total
 Western Europe -
 European Community 5,180 37 4,831 36
 Western Europe - EFTA 2,954 21 3,390 25
 North America 2,294 17 2,632 19
 Asia and Australasia 2,301 17 1,824 14
 Africa, Eastern Europe,
 Latin America 1,109 8 880 6
 Total 13,838 100 13,557 100
 (A) Total revenues for all ABB companies from third party customers in each region.
 ORDERS RECEIVED AND REVENUES PER BUSINESS SEGMENT
 (US$ in millions)
 Orders Received Revenues
 Six Months Six Months Six Months Six Months
 1992 1991 1992 1991
 Power Plants 3,949 2,496 2,813 2,424
 Power Transmission 3,212 2,764 2,711 2,681
 Power Distribution 1,850 1,755 1,562 1,541
 Industry 2,704 2,158 1,808 2,019
 Transportation 1,383 1,167 1,145 897
 Environmental Control 1,626 1,836 1,488 1,851
 Financial Services 381 406 381 406
 Various Activities 4,190 3,861 3,882 3,500
 Group Total 19,295 16,443 15,790 15,319
 - Intragroup
 transactions -2,212 -1,927 -1,952 -1,762
 Net Total 17,083 14,516 13,838 13,557
 CONSOLIDATED INCOME STATEMENT
 (US$ in millions)
 Six Months Six Months
 1992 1991 1991
 Revenues 13,838 13,557 28,883
 Material expenses (5,416) (5,681) (11,764)
 Personnel Expenses (4,852) (4,703) (9,482)
 Other expenses (2,504) (2,207) (4,911)
 Changes in work in progress
 and finished goods 264 344 1
 Depreciation of fixed assets (433) (413) (819)
 Operating earnings after
 depreciation 897 897 1,908
 Earnings from associated/
 divested companies 3 0 19
 Dividend income 12 7 13
 Interest income 421 486 798
 Interest on advances (221) (198) (440)
 Interest expense (581) (679) (1,158)
 Exchange differences (13) 7 13
 Earnings after financial items 518 520 1,153
 Nonrecurring items (22) 16 (105)
 Income before taxes 496 536 1,048
 Note: Exchange rates used in the above income statement are average for the periods shown. The average exchange rates for the Swiss Franc and the Swedish Krona are stated below:
 Six Months Six Months
 1992 1991 1991
 1.00 US$ - SFr.: 1.44 1.39 1.42
 1.00 US$ - SKr.: 5.79 5.97 6.01
 -0- 8/26/92
 /CONTACT: Karen Armour of ABB, 203-328-2217, or evenings, 203-655-9461 CO: ABB Group ST: IN: SU:


LR -- NY008 -- 3325 08/26/92 09:02 EDT
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Date:Aug 26, 1992
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