Engineering firm ABB sees profits rise as expected

AFP/The Local
AFP/The Local - [email protected]
Engineering firm ABB sees profits rise as expected

Net profits at Swedish-Swiss engineering group ABB jumped 12 percent in the third quarter to $1.03 billion, the company announced on Thursday.


The results were in line with expectations.

The third quarter profit compared with $927 million for the same period last year.

The group set aside $850 million in December for likely costs from US and EU probes into alleged cartel activities, a tax dispute and asset writedowns, it said 10 days ago. But it has now reduced the provisions to $380 million.

The group was fined €33.75 million ($50 million) by the European Commission over anti-competitive practices in the power transformer market.

ABB added that its third-quarter earnings would be hit by an increase in charges incurred by its business in Russia.

"As a result, ABB continues reviewing the situation and assessing its business model in Russia," it said.

In July, the group posted net profits of $675 million for the second quarter.

The outlook for ABB's businesses over the rest of 2009 and into 2010 remains uncertain," said the group.

While all regions continue to need energy-efficient power infrastructure, the group said it was "unclear" when and how soon capital investment by customers will recover from the economic 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," ABB said.


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