ABB 2006 net income rises 89% to $1.4 billion | Automation.com

ABB 2006 net income rises 89% to $1.4 billion

  • 2006 earnings before interest and taxes (EBIT) up 45% at $2.6 billion
  • Full-year EBIT margin advances to 10.6%
  • Strong Q4 helps lift full-year orders by 22%, revenues by 11%
  • 2006 cash flow from operations doubles to $2 billion
  • Board of Directors will propose a dividend of CHF 0.24 per share

    Zurich, Switzerland, February 16, 2007 - ABB's net income rose 89 percent to $1,390 million in 2006 amid strong demand for technology to increase power grid reliability, industrial productivity and energy efficiency.

    Revenues for 2006 reached $24,412 million, an increase of 11 percent (10 percent in local currencies) over 2005, while orders were 22 percent higher (22 percent in local currencies) at $28,401 million. The order backlog stood at $16,953 million at the end of 2006, up $5 billion or 42 percent (33 percent in local currencies) compared to a year earlier.

    Growing revenues, higher capacity utilization and further cost reductions all contributed to a 45-percent increase in EBIT to a record $2,586 million in 2006. The EBIT margin, or EBIT as a percentage of revenues, increased to 10.6 percent from 8.1 percent in 2005.

    "We have the right technology and market positions to take advantage of the growing global demand for reliable power and higher industrial efficiency," said Fred Kindle, ABB President and Chief Executive Officer. "Our order backlog has grown significantly and improved business execution is allowing us to capture more of that growth in our bottom line. We are heading into 2007 in a strong position."

    In the fourth quarter ending December 31, 2006, orders rose 36 percent (30 percent in local currencies) while revenues were 21 percent higher (up 16 percent in local currencies) than in the fourth quarter of 2005. Fourth-quarter EBIT increased 43 percent to $744 million, producing an EBIT margin of 10.4 percent. Net income in the quarter was $422 million, up 90 percent from the same period a year ago.
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