ABB reports 31 per cent Q2 net profit drop

ABB reports 31 per cent Q2 net profit drop Geneva - ABB, the Swiss engineering company, reported Thursday double-digit drops in sales, earnings and orders performance in the second quarter of 2009 in what it called a "challenging" business environment.

ABB said net income fell 31 per cent year-on-year to 675 million dollars, while sales revenues, at 7.9 billion dollars, were down 12 per cent. Orders dropped 35 per cent to around 7 billion dollars.

"The economic environment remains challenging," said ABB's chief Joe Hogan in a statement, but noted opportunities in both the need for better power management technologies and renewable energies.

"Significant uncertainty remains surrounding the key demand drivers for the company's products and systems," the company said, adding that it was "unable to precisely forecast when the various government stimulus programs will have an impact or when the availability of funding will improve."

Analysts felt that while profits were down, largely owing to the economic crisis, the company was showing "resilience" and would do well in the long-term, barring unforeseen problems.

The Zurich-based company is a major global player in power and automation technology, with a focus on electricity grids.

Orders decreased across all divisions and regions, the company said, when compared to last year's high levels of sales in the second quarter.

Reduced consumer spending in the United States offset even large projects on the power grids in both Brazil and Mexico, in the Americas region. In Europe too orders were down.

Automation products however saw a boost on higher orders from India. (dpa)