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ABB blames strong dollar for dip in profits

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Photo: Roland Fischer
17:32 CEST+02:00
Swiss engineering group ABB on Thursday reported a 26 percent drop in second quarter net profit to $656 million, blaming a stronger dollar for lower earnings.

The $100 million purchase of US low voltage products manufacturer Thomas & Betts in May was also factored into the results, ABB said in a statement.

Core earnings amounted to $1.5 billion, down five percent year-on-year.

The company said cost savings of $280 million had offset the impact of lower margins, but it blamed "an unfavourable business mix" and "significant differences in foreign exchange rates compared with the second quarter in 2011" for reduced US revenues.

ABB underlined the uncertain economic climate but said it was positive about continued demand for its transmission grids.

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"The macroeconomic view remains uncertain, but the positive developments we've seen in China, the continued strength of the US market and our resilience in Europe make us more confident about the short-term outlook than we were three months ago," said chief executive Joe Hogan.

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