ABB Shares Up On Q1 Earnings Beat, Announces ADRs Delisting From NYSE

  • ABB Ltd ABB reported Q1 2023 revenue of $7.86 billion, up 13% Y/Y and 22% Y/Y on a comparable basis, exceeding the consensus of $7.49 billion.
  • Orders increased by 1% Y/Y to $9.45 billion and grew 9% Y/Y on a comparable basis.
  • Electrification revenue $3.59 billion (+11% Y/Y), Orders $4.14 billion (+1% Y/Y) and Backlog $7.10 billion (+19% Y/Y).
  • Motion revenue $1.94 billion (+23% Y/Y), Orders $2.26 billion (+3% Y/Y) and Backlog $5.10 billion (+18% Y/Y).
  • Process Automation revenue $1.44 billion (-5% Y/Y), Orders $2.11 billion (+25% Y/Y) and Backlog $6.89 billion (+11% Y/Y).
  • Robotics & Discrete Automation revenue $937 million (+28% Y/Y), Orders $1.00 billion (-23% Y/Y) and Backlog $2.78 billion (+12% Y/Y).
  • Gross profit margin expanded by 190 basis points to 34.6%. 
  • Operational EBITA was up 28% Y/Y to $1.28 billion, and the margin expanded by 200 basis points to 16.3%.
  • EPS improved to $0.55 in Q1 2023 (vs $0.31 in Q1 2022), surpassing the consensus of $0.51.
  • ABB's cash flow from operating activities was $282 million, compared to cash used in operating activities of $(573) million a year ago.
  • As a final part of pre-IPO funding tranche, ABB's E-mobility business inked an agreement with four minority investors to raise an additional CHF325 million in funds in exchange for around a 12% shareholding in the company in Q1. 
  • In Q1, ABB disclosed a deal to sell its Power Conversion division to AcBel Polytech Inc for $505 million in cash, with the transaction expected to close in the second half of 2023. 
  • ADR Delisting: ABB disclosed its plan to delist its American Depositary Receipts (ADRs) from NYSE. The company intends to convert its current sponsored Level II ADR program into a sponsored Level I ADR program, offering U.S. investors a continued investment option and the ordinary ABB share. 
  • Repurchase: Early this month, ABB launched its new share buyback program of up to $1 billion that will run until March 2024. 
  • Q2 Outlook: ABB anticipates double-digit comparable revenue growth and the Operational EBITA margin to improve Y/Y.
  • In FY23, the company expects comparable revenue growth of at least 10%, with Y/Y improvement in Operational EBITA margin.
  • Price Action: ABB shares traded higher by 3.06% at $36.73 premarket on the last check Tuesday.
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