Swiss engineering company ABB, Ltd. (NYSE – ABB – $18.53) said that second quarter profits fell sharply due to charges relating to the sale of its solar-inverter business. The company reported net profit of $64 million compared with $681 million a year earlier, while revenue climbed 7% to $7.17 billion from $6.73 billion. Analysts had predicted net profit of $25.6 million on revenue of $7.09 billion. Operational earnings before interest, taxes and amortization, which strips out one-off effects, edged down to $825 million from $855 million, and adjusted earnings per share totaled $0.34 vs. $0.38 last year and compared to a $0.28/share Street estimate. Total orders and revenues continued to grow, led by Electrification and Motion while Robotics and Discrete Automation in particular felt the downturn in automotive and machine building,
The company issued a fairly cautious short-term outlook, noting that global markets remain affected by geopolitical uncertainties and the shares sold off in today’s trading. The company’s growth strategy rests on leadership in digital industries. Beginning in the second quarter, ABB simplified its structure by creating four business divisions, denoted as Electrification, Industrial Automation, Robotics & Discrete Automation, and Motion. Each segment has full control of its own operations, functions, research and development and territories. Patient investors may want to hold for recovery as ABB continues its ongoing restructuring under new leadership. The shares yield 4%.