In the third quarter of this year ABB saw strong demand, but supply chain constraints impacted revenues. They received orders for 7.9 billion dollar, reported a revenue of 7.0 billion, and an income from operations of 852 million. “In the face of a difficult supply chain environment, I am pleased that we achieved a good margin this quarter. Our cash generation was very strong, leaving ample headroom on our balance sheet to support both organic growth and acquisitions as well as rewarding shareholders” said CEO Björn Rosengren.
ABB calls Q3 a mixed picture, containing on one hand a high level of demand driving strong order growth, while on the other hand the tight supply chain impacted their revenues more than anticipated. Orders increased by 29% (26% comparable), year-on-year. All business areas contributed with double-digit growth rates and all segments and regions noted positive developments. In sequential terms, the underlying customer activity increased somewhat in the Americas, declined in Europe and remained stable in China.
Constraints
Revenues were hampered by supply chain constraints delaying customer deliveries. This was primarily related to semiconductors and imbalances in the overall supply chain, with the impact most tangible in Electrification and Robotics & Discrete Automation. Revenues increased by 7% (4% comparable). Operational EBITA increased by 35% year-on-year, and margin expanded by 310 basis points, to 15.1%. This improvement however benefited from the adverse temporary items in last year’s results, good development in most business areas and unusually low corporate costs in the current quarter.
Cash more than doubled from last year to USD 1.1 billion. In this quarter Robotics and Discrete Automation acquired ASTI Mobile Robotics Group (ASTI), an autonomous mobile robot (AMR) manufacturer. In the fourth quarter of 2021 ABB anticipates a continued tight supply chain to impact customer deliveries. Comparable revenue growth is estimated to be broadly similar to the third quarter.
