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ABB profit rise falls short of expectations

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08:49 CEST+02:00
Swedish-Swiss engineering giant ABB on Wednesday reported a 41 percent increase in first quarter net profit, driven by strong demand from industry and power utilities.

Net profit reached $655 million during the first three months of the year while revenues registered their strongest quarterly growth in two years with an increase of 21 percent to $8.4 billion, the group said in a statement.

According to a survey carried out by Reuters, analysts had expected ABB to post profits of $687 million.

Orders grew by 28 percent across all of the engineering group's divisions.

"Our results show we're gaining traction in both growth and profitability," said chief executive Joe Hogan, predicting "continued strong demand."

"ABB's long-term key growth drivers remain intact-the increasing need for energy efficiency, industrial productivity and more reliable power infrastructure in both the mature and emerging economies," he added.

ABB experienced a 12 percent drop in annual net profit last year to $2.56 billion, announcing large cost cutting but forecasting that emerging markets would drive growth through 2011.

Earlier in the month, the company announced it had won a $120 million order from China's State Grid Corporation (SGCC) for an ultra high voltage electricity line.

In March, ABB landed a $900 million order from Power Grid Corporation of India Ltd. (PGCIL) to deliver an ultrahigh-voltage transmission system in Agra, India.

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