Slide 1: ABB Q3 2013 results
October 24, 2013 ABB Q3 2013 results Ulrich Spiesshofer, CEO Eric Elzvik, CFO
Slide 2: Important notices
Important notices This presentation includes forward-looking information and statements including statements concerning the outlook for our businesses. These statements are based on current expectations, estimates and projections about the factors that may affect our future performance, including gl
Slide 3: Q3 2013: Solid performance across the business
Q3 2013: Solid performance across the business Earnings per share up 8% YTD Growth Base orders return to year-on-year growth1—up 5% vs Q3 2012 Project selectivity in PS and delays in large order awards reduced total orders Order growth in Asia and Europe; North America lower vs high levels in
Slide 4: Key figures for Q3 and first 9 months of 2013
Key figures for Q3 and first 9 months of 2013 Solid execution yields strong cash flow improvement Q3 13 Q3 12 Change 9M 13 9M 12 Change US$ Local US$ Local currency currency Orders 9,089 9,295 -2% -2% 28,893 29,715 -3% -3% Order backlog (end Sept) 27,454 29,175 -6% -4% Revenues 10,535 9,745 +8% +9%
Slide 5: Strong order contribution from Asia
Strong order contribution from Asia Double-digit growth in China and Germany Order growth in selected countries, Q3 13 vs Q3 12 (in local currencies) Europe Automation +2% +2% Power +1% Germany +17% France +14% Sweden +14% United Kingdom -9% Italy -9% Americas Automation -3% -7% Power -14% US 0% Can
Slide 6: Q3 2013 divisional growth overview
Q3 2013 divisional growth overview Orders reflect early-cycle growth, large project delays Change vs Q3 12 Change vs Q3 12 US$ millions Orders in local currencies Revenues in local currencies Discrete Automation and 2,410 +6% 2,539 +10% Motion Low Voltage Products 1,938 +3% 2,001 +6% Process Automat
Slide 7: Q3 2013 divisional earnings overview
Q3 2013 divisional earnings overview Delivering on target across the portfolio Change vs Q3 12 Change vs Q3 12 US$ millions Op EBITDA in US$ Op EBITDA margin in percentage points Discrete Automation and 476 +9% 18.8% -0.1 Motion Low Voltage Products 395 +8% 19.7% +0.2 Process Automation 289 +24% 13.
Slide 8: Operational EBITDA up >$150 million
Operational EBITDA up >$150 million Savings outweigh price impact through 2012 and 2013 Factors affecting operational EBITDA Q3 2013 vs Q3 2012 US$ millions +$224 1'638 +$46 Mix 1'483 Other -$44 Project costs, Net volume forex, other provisions Net savings Positive volume Cost savings impact, stable
Slide 9: Operational EPS analysis
Operational EPS analysis Q3 13 Q3 12 9M 13 9M 12 Net Net Net Net EPS EPS change2 EPS EPS change2 US$ millions, except per share data in US$ income income income income Net income (attributable to ABB) 835 0.36 759 0.33 10% 2,262 0.99 2,100 0.92 8% Restructuring and restructuring- 29 16 67 40 related
Slide 10: Stronger cash flow across most of the portfolio
Stronger cash flow across most of the portfolio NWC will remain a high management priority Cash from operating activities Q3 13 vs Q3 12 US$ millions 1,321 1,241 +43% Solid cash generation by the divisions 921 768 Net working capital at 18% of revenues Divisional cash Balance sheet flow from ope
Slide 11: Three focus areas moving into 2014
Three focus areas moving into 2014 Profitable growth Business-led collaboration Relentless execution
Slide 12: The ABB vision remains Power and productivity for a better world
The ABB vision remains Power and productivity for a better world What remains unchanged Execution against the 2011-15 strategy Customer and market orientation Technology leadership Implementation of our service strategy Sustainable cost and productivity improvements Build on a platform o
Slide 13: Next stage of excellence
Next stage of excellence Accelerated growth momentum, continued profit focus Profitable Growth Tomorrow Growth momentum Business-led collaboration Today Relentless execution Profit Focus on EPS and CROI Chart 13
Slide 14: Profitable growth: PIE drives enhanced growth momentum
Profitable growth “PIE” drives enhanced growth momentum Penetration Innovation Expansion How to sell more of our existing offering to accessible How to create new offering/value How to expand into new customers? proposition? segments? Optimize channels, e.g., ABB a top innovator, e.g. Power-On
Slide 15: Business-led collaboration
Business-led collaboration For greater customer value—and ABB productivity Russian icebreakers Customer value DM LP PA PP PS Higher efficiency and maneuverability Australia iron ore mining Integrated power and data management for higher DM LP PA PP PS productivity Integrated data South Africa
Slide 16: Relentless execution
Relentless execution Delivering world-class competitiveness Focus Continue to drive cost and productivity improvements Take out 3-5% costs of sales every year—on track Confident in future performance, adding white collar focus Improved Net Working Capital management and cash flow improvement
Slide 17: Key leadership appointments and organizational alignment
Key leadership appointments and organizational alignment Jean-Christophe Deslarzes (Swiss) succeeds Gary Steel as EC member for Human Resources Proven HR competence in industry and retail Global experience in operations and acquisition integration Senior business leader with strong P&L track r
Slide 18: A strong and experienced executive team
A strong and experienced executive team Ulrich Spiesshofer Bernhard Jucker Brice Koch Pekka Tiitinen Tarak Mehta Veli-Matti Reinikkala CEO Power Power Discrete Automation Low Voltage Process Products Systems and Motion Products Automation Eric Elzvik Frank Duggan Greg Scheu Jean-Christophe Diane CFO
Slide 19: Summary and outlook
Summary and outlook
Slide 20: Mid-term demand outlook
Mid-term demand outlook Early cycle encouraging, some uncertainties remain Americas Europe Asia High level of Utility spending remains low Power Continues to outgrow uncertainty in US Industrial demand varies world GDP >2x Industrial demand soft widely by country, e.g., Early cycle deman
Slide 21: Outlook for the remainder of 2013
Outlook for the remainder of 2013 Growth Long-term demand drivers remain in place and early-cycle macro developments positive However, several forward-looking indicators contain mixed signals We still face some near-term market uncertainty Growth focus on market penetration, innovation, expa
Slide 22: Power and productivity for a better world
Power and productivity for a better world™ Chart 22 A F A a
Slide 23: Balanced business and geographic portfolio
Balanced business and geographic portfolio Orders by division Q3 2013 Orders by region Q3 2013 Non-consolidated Middle East Power Discrete and Africa Systems Automation 13% 9% 25% and Motion 33% Europe Asia 27% Power 25% Low Voltage Products 20% Products 17% 31% Process Americas Automation Chart 23
Slide 24: Orders and revenues by region and division Q3 2013
Orders and revenues by region and division Q3 2013 Regional share of total orders and revenues by division 3% 6% 7% 12% 19% 10% 7% 28% Orders 28% 36% 24% 37% 23% 37% 38% 27% 31% 30% 24% 30% 33% 37% 23% 30% 39% 30% 18% 18% 30% 33% 33% 26% 25% Discrete Automation Low Voltage Process Power Products Pow
Slide 25: Order backlog by division
Order backlog by division Order backlog (end September) Q3 2013 Q3 2012 Change % US$ millions US$ Local currencies Discrete Automation and Motion 4,532 4,587 -1% 0% Low Voltage Products 1,242 1,081 +15% +17% Process Automation 5,995 6,316 -5% -3% Power Products 8,479 8,798 -4% -3% Power Systems 9,95
Slide 26: For more information, call ABB Investor Relations
For more information, call ABB Investor Relations Or visit our website at www.abb.com/investorcenter Name Telephone E-mail Zurich, Switzerland Alanna Abrahamson +41 43 317 3804 alanna.abrahamson@ch.abb.com Head of Investor Relations John Fox +41 43 317 3812 john.fox@ch.abb.com Binit Sanghvi +41 43 3