abb2023q1fininfo

6-K 1 tm2313664d1_6k.htm FORM 6-K abb2023q1fininfo

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE

ISSUER PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of April 2023

Commission File Number 001-16429

ABB Ltd

(Translation of registrant’s name into English)

Affolternstrasse 44, CH-8050, Zurich, Switzerland

(Address of principal executive office)

Indicate by check mark whether

the registrant files or will file

annual reports under cover of Form

20-F or Form 40-F.

Form 20-F

☒

Form 40-F

⬜

Indicate by check mark if the registrant

is submitting the Form 6-K in paper

as permitted by Regulation S-T Rule

101(b)(1):

⬜

Note:

Regulation S-T Rule 101(b)(1) only

permits the submission in paper of

a Form 6-K if submitted solely to provide

attached annual report to security

holders.

Indication by check mark if the registrant

is submitting the Form 6-K in paper

as permitted by Regulation S-T Rule

101(b)(7):

⬜

Note:

Regulation S-T Rule 101(b)(7) only

permits the submission in paper of

a Form 6-K if submitted to furnish a

report or

other document that the registrant foreign

private issuer must furnish

and make public under the laws of the

jurisdiction in

which the registrant is incorporated, domiciled

or legally organized (the registrant’s “home country”),

or under the rules of the

home country exchange on which the registrant’s securities

are traded, as long as the report

or other document is not a press

release, is not required to be and has

not been distributed to the registrant’s security holders,

and, if discussing a material event,

has already been the subject of a Form

6-K submission or other Commission

filing on EDGAR.

Indicate by check mark whether

the registrant by furnishing the

information contained in this Form

is also thereby furnishing

the information to the Commission

pursuant to Rule 12g3-2(b) under

the Securities Exchange Act of 1934.

Yes

⬜

☒

If “Yes” is marked, indicate below the file number assigned to the

registrant in connection with Rule 12g3-2(b):

82-

This Form 6-K consists of the following:

Press release issued by ABB Ltd dated April

25, 2023 titled “Q1 2023 results”.

Q1 2023 Financial Information.

Press release issued by ABB Ltd dated

April 25, 2023 titled “ABB plans

to delist ADRs from NYSE”.

Announcements regarding transactions

in ABB Ltd’s Securities made by the directors or the

members of the

Executive Committee.

The information provided by Item

2 above is hereby incorporated by reference

into the Registration Statements

on Form F-3 of

ABB Ltd and ABB Finance (USA) Inc.

(File Nos. 333-223907 and 333-223907-01)

and registration statements on Form

S-8

(File Nos. 333-190180, 333-181583,

333-179472, 333-171971 and

333-129271) each of which was

previously filed with the

Securities and Exchange Commission.

—

ZURICH, SWITZERLAND, APRIL

25, 2023

Q1 2023 results

Strong start to the year

●

Orders $9,450 million

+1%; comparable

+9%

●

Revenues $7,859 million

+13%; comparable

+22%

●

Income from operations

$1,198 million; margin

15.2%

●

Operational EBITA

$1,277 million;

margin

16.3%

●

Basic EPS $0.56;

+78%

●

Cash flow from operating

activities

$282 million

Ad hoc Announcement pursuant to Art.

53 Listing Rules of SIX Swiss Exchange

—

Q1 2023

First three months

Press Release

—

“ABB had a strong start to the year, with a positive development in most measures,

including cash flow. This gives us the confidence to raise our 2023 guidance.”

Björn Rosengren

, CEO

KEY FIGURES

CHANGE

($ millions, unless otherwise indicated)

Q1 2023

Q1 2022

US$

Comparable

Orders

9,450

9,373

Revenues

7,859

6,965

13%

22%

Gross Profit

2,716

2,281

19%

as % of revenues

34.6%

32.7%

+1.9 pts

Income from operations

1,198

857

40%

Operational EBITA

1,277

997

28%

33%

as % of operational revenues

16.3%

14.3%

+2 pts

Income from continuing operations, net of tax

1,065

643

66%

Net income attributable to ABB

1,036

604

72%

Basic earnings per share ($)

0.56

0.31

78%

Cash flow from operating activities

282

(573)

n.a.

For a reconciliation of non-GAAP measures, see “supplemental

reconciliations and definitions” in the attached

Q1 2023 Financial Information.

EPS growth rates are computed using unrounded amounts.

Constant currency (not adjusted for portfolio

changes).

Amount represents total for both continuing and

discontinued operations.

ABB

INTERIM

REPORT

2023

Customer activity was

strong in the first quarter

Despite a very

high comparable from

last year,

we increased order intake

1% (9% comparable)

with a positive development

in three out

of four business

areas. While Robotics & Discrete

Automation

improved orders sequentially,

it declined from last year’s high

level which benefited

from pre-buys in a period

of significant

component shortages.

Particularly strong momentum

was noted

in Process Automation

with orders reaching the

highest level in

recent history.

A positive underlying momentum

was noted also

in all three regions.

Just like in the previous

quarter, we

did not

face significant

supply chain constraints,

hence we converted backlog

into

customer deliveries.

Revenue growth was strong

at 13%

(22%

comparable), with double

-digit comparable increases

in all

business areas. The

impacts from robust development

in both

pricing and volumes

more than offset the notable

adverse

impact from changes

in exchange rates.

Despite strong

revenue growth we

built order backlog, with

book-to-bill at

120%.

I was pleased about

the operational execution

of the increased

revenues.

We improved the

Operational EBITA by

28%

$1,277 million and

the margin was up by 200

basis points to

16.3%. This is the strongest

first quarter result in many

years.

On top of the strong operational

performance, net income was

additionally supported

by net positive tax

impacts of

approximately $200

million linked to a favorable

resolution of

certain prior year tax

matters, mainly related to

the divestment

of the Power Grids

business.

It was good to see

our cash flow improve from

last year by $855

million, in line with

our expectations. Cash

flow from operating

activities of $282

million was strong for a first

quarter,

and set

us off to a robust

start for what I expect

will be a good cash

delivery this year.

I feel confident that our

balance sheet will be

strong enough to support

both organic and acquired

growth, a

rising, sustainable dividend

per share over time and

utilizing

share buybacks as

a means to return excess

cash to our

shareholders. In early

April, we launched our new

buyback program of up

to $1 billion, which will run

until March

2024.

In February,

we published our first integrated

report, including

our 2022 sustainability

report showing solid progress

toward our

2030 goals. One highlight

to mention is that we

reduced our

own greenhouse

gas emissions by 43%, a

total reduction of

65% from the 2019

baseline.

Furthermore, we defined

a new emissions reduction

target for

our supply chain, covering

suppliers that account for

70% of our

procurement spend.

We have continued our

work to strengthen

ABB’s circularity approach

by defining clear key performance

indicators for every

stage of the product life

cycle, from design

to end-of-life. The largest positive

environmental impact

we can

make is through providing

our customers with resource

-efficient

products and the demand

for clean energy and

efficiency is

broad and long-term.

After having been listed

on the New York

Stock Exchange

(NYSE) since 2001,

we have decided to delist

and plan to

eventually deregister

with the SEC.

The main reason being

that

the access to international

equity markets has increased

since

our listing,

through digital trading on

multiple platforms.

Consequently,

we no longer see the

need to be listed on as

many as three equity

capital markets. We

plan to delist our

American Depositary

Receipts (ADRs) on or

around May 23,

2023, and as from the

time of delisting, the ABB ADRs

will

instead be converted

to a sponsored Level

I program. This still

gives US investors

the ability to invest in

ABB through ADRs.

The ABB shares

will remain listed on the

SIX Swiss Exchange

and the Swedish

Nasdaq exchange due to the

company’s

heritage. The delisting

and planned deregistration

in the US

would be yet another

step towards further simplification

and

efficiency at ABB.

I want to emphasize

that we remain as committed

to the US-

market, which represent

ed 24% of our revenues

in 2022. The

United States is critical

to ABB’s success, and

approximately

85%

of ABB’s sales

in the US are from products

produced

locally.

support future success,

we are currently investing

approximately $170

million in our US facilities

to meet

increasing demand

for clean energy and automation.

Björn Rosengren

CEO

In the

second quarter of 2023

, we anticipate double-digit

comparable revenue

growth to support an improvement

in the

Operational EBITA

margin,

year-on-year.

In full-year 2023

, despite current market uncertainty,

anticipate comparable

revenue

growth to be at least

10%

and

we expect to improve

Operational EBITA

margin,

year-on-year.

CEO summary

Outlook

ABB

INTERIM

REPORT

2023

In the first quarter,

a robust customer activity

resulted in an

order intake of $9,450

million, representing an

increase of 1%

(9% comparable) from

last year’s high level. The strongest

order momentum was

noted in the late-cyclical

process

industry-related business

segments.

Order intake improved

in three out of four business

areas.

Process Automation

increased orders by 25%

(55%

comparable) supported

by a strong general demand

pattern

as well as by timing of

larger project orders, and

additionally

by the impact from

the de-booking of approximately

$190 million in last

year’s period. Electrification

orders were

up by 1% (5% comparable)

despite weakness in the

residential construction

market. Motion improved

by 3% (8%

comparable). In Robotics

& Discrete Automation

customers

returned to a seemingly

more normal order pattern,

recovering from the

previous quarter,

although some

hampering effect

from customers outside

of the automotive

segment adjusting

inventory levels was noted.

In total, orders

declined by 23%

(20% comparable)

from the high comparable

last year.

The automotive segment

improved on EV-related

investments, while

softening demand was noted

in the

robotics consumer

related segments.

In transport & infrastructure,

there was a positive development

marine & ports and

renewables. In buildings

there was weakness

in all three regions

in residential-related demand,

while

commercial construction

was solid.

Demand in the process

-related business was strong

across the

board, with particular strength

in oil & gas, and it held

up well also

for refining, water & wastewater,

power generation and

pulp &

paper.

Customer activity was

high in all three regions.

Orders in Europe

increased by 1% (10%

comparable), with growth

rates reflecting

the de-booking last year

The underlying business increased

slightly,

despite weakness in Germany.

Asia, Middle East and

Africa declined by 2%

(up 11%

comparable), although

China

declined by 12%

(3% comparable).

The Covid-related

implications in China

eased quickly,

and demand came off

to a

strong start early in

the quarter with the additional

timing related

support from ordering

ahead of the New Year

celebrations in

China,

after which

customer activity slowed

somewhat from the

record-high comparable

last year.

The Americas improved

by 3%

(5% comparable), weighed

down by the United States

which

declined by 4% (3% comparable)

from the challenging

comparable in last

year’s period.

Orders and revenues

Orders by region

($ in millions,

unless otherwise

indicated)

CHANGE

Q1 2023

Q1 2022

US$

Comparable

Europe

3,582

3,534

10%

The Americas

2,985

2,897

Asia, Middle East

and Africa

2,883

2,942

-2%

11%

ABB Group

9,450

9,373

Growth

Change year-on-year

Orders

Revenues

Comparable

22%

-5%

-6%

Portfolio changes

-3%

Total

13%

Revenues by region

($ in millions,

unless otherwise

indicated)

CHANGE

Q1 2023

Q1 2022

US$

Comparable

Europe

2,872

2,518

14%

24%

The Americas

2,653

2,169

22%

25%

Asia, Middle East

and Africa

2,334

2,278

16%

ABB Group

7,859

6,965

13%

22%

ABB

INTERIM

REPORT

2023

Gross profit

Gross profit increased

strongly by 19% (25% constant

currency) to

$2,716 million, supported

by a significant

gross margin

improvement of

190 basis points to 34.6%.

Gross margin improved

in all business areas,

with three showing significant

increases.

Income from operations

amounted to $1,198 million,

representing a

strong increase of 40

(46%

constant currency),

year-on-year.

Compared with last

year, earnings

were mainly supported

by the

improved operational

performance, with some

additional tailwind

from lower expenses

related to both acquisition

and divestments

and non-operational

items.

Operational EBITA

The year-on-year improvement

was driven by strong operational

execution of the significantly

higher volumes as

well as benefits

from successful price

management

with only a slight adverse

impact from raw materials

and freight costs. Price

clearly more than

offset higher

labor costs. Selling, general

and administrative

expenses declined

in relation to revenues to 17.0%,

from 17.8%

last year.

The operational improvements

more than offset the

adverse impact from

changes in exchange

rates, resulting in an

Operational EBITA

of $1,277

million, an increase of 28% (33%

constant currency)

year-on-year.

Operational EBITA in

Corporate

and Other amounted

to -$111

million, out of which -$28

million

related to the E-mobility

business, which is reported as

part of

Group Corporate and

Other as from this quarter.

Net finance expenses

Net finance expense

was $21 million,

somewhat lower than

expected due to

a reduction in certain income

tax-related risks.

Income tax

Income tax expense

was $119

million with an effective

tax rate of

10.1%, including approximately

17% net benefit on the favorable

resolution of a prior

year tax matter relating to

the divestment of the

Power Grids business.

Net income and earnings

per share

Net income attributable

to ABB was $1,036 million and

increased by

72%, driven primarily by

improved operational performance

and the

benefit of the resolution

of the prior year tax matter

booked in the

quarter.

This resulted in basic earnings

per share of $0.56, up

from

$0.31

last year.

Operational EBITA

($ millions)

Q1 2023

Q1 2022

Corporate and Other

E-mobility

(28)

(2)

Corporate costs, intersegment

eliminations and other

(83)

(32)

Total

(111)

(34)

Majority of which relates to underlying corporate

Earnings

ABB

INTERIM

REPORT

2023

Net working capital

amounted to $4,164 million,

increasing

year-on-year from $3,461

million and sequentially

from

$3,216 million.

The sequential increase

was mainly driven

by higher receivables

triggered by high revenue

growth and

higher inventories on

the back of continued

strong order

intake.

That said, inventory volumes

began to decline

toward the end of the

quarter.

Net working capital as a

percentage of revenues

was 13.9% up from 11.1%.

Capital expenditures

Purchases of property,

plant and equipment

and intangible

assets amounted to

$151 million.

Net debt

amounted to $3,826 million

at the end of the quarter

and increased from

$2,772 million year-on-year,

and

sequentially from $2,779

million. The sequential

increase was

mainly driven by

the initial dividend payment

s, partially offset

by positive free cash

flow during the period

as well as the

shares issued in our subsidiary

ABB E-mobility to third

parties

in private placements

of $341 million.

Cash flows

Cash flow from operating

activities was $282

million and

increased year-on-year

from -$573 million. The

improvement

was driven by positive

cash generation across

all business

areas on the back of higher

earnings and a lower build-up

of net

working capital,

year-on-year. It

should also be noted that

last

year’s cash flow included

a negative cash flow

of approximately

$170 million for income

taxes related to business

separations.

Share buyback program

ABB has completed

its share buyback program that

was

launched in April 2022.

Through this buyback program,

ABB

repurchased a total

of 67,459,000 shares –

equivalent to 3.29%

of its issued share

capital at launch of the buyback

program –

for a total amount of approximately

$2 billion. This included

the

remaining $1.2 billion

of the $7.8 billion of cash

proceeds from

the Power Grids divestment.

A new share buyback program

up to $1 billion was

launched on April 3, 2023.

($ millions,

unless otherwise indicated)

Mar. 31

2023

Mar. 31

2022

Dec. 31

2022

Short term debt and current

maturities of long-term debt

3,433

3,114

2,535

Long-term debt

5,230

6,171

5,143

Total debt

8,663

9,285

7,678

Cash & equivalents

3,438

5,216

4,156

Restricted cash - current

Marketable securities and

short-term investments

1,380

967

725

Restricted cash - non-current

–

300

–

Cash and marketable securities

4,837

6,513

4,899

Net debt (cash)*

3,826

2,772

2,779

Net debt (cash)* to EBITDA ratio

0.9

0.4

0.7

Net debt (cash)* to Equity ratio

0.30

0.20

0.21

At Mar. 31, 2023, Mar. 31, 2022 and Dec. 31, 2022, net debt(cash) excludes net

pension

(assets)/liabilities of $(301) million $(13) million and $(114) million, respectively.

Balance sheet & Cash flow

ABB

INTERIM

REPORT

2023

Orders and revenues

Despite a very challenging

comparable from last

year, order

intake increased by

1% (5% comparable) to

$4,141 million, the

highest quarterly level in

several years.

Strong orders added

further to the order backlog,

with book-

to-bill at 115%.

●

Demand improved

in all customer segments

except for

residential construction,

which declined year-on-year

in all

three regions. Weakness

in residential construction

impacted primarily the

Smart Buildings division,

and to

some extent also Installation

Products, while the other

divisions generally

improved order intake at

a double-digit

pace.

●

Orders increased by

4% (15% comparable)

in Asia, Middle

East and Africa,

as the decline in China of

11%

(4%

comparable) was more

than offset by a strong

development

elsewhere in the

region. Europe improved by

1% (5%

comparable), as a solid

development in a majority

of the

markets more than

offset a low single-digit

decline in

Germany.

The Americas declined

slightly by 1% (1%

comparable), weighed

down by a 6% drop in the

United

States.

●

Revenues increased

by 11%

(16% comparable)

to the

highest level in many

years, with strong developments

both pricing and

volume, supported by solid

market

demand and execution

of the order backlog.

●

This was the first quarter

when the E-mobility business

was

not reported as part

of the business area. In

preparation of

the planned separate

listing and new governance

structure,

E-mobility is now reported

in Corporate and Other.

Profit

Both earnings and

margin reached their

highest levels in recent

history.

Operational EBITA amounted

to $677

million, up 32% year-

on-year, and

the Operational EBITA

margin reached 19.0%,

representing a 310

basis points improvement.

●

The impacts from operational

leverage on increased volumes

and strong pricing activities,

in combination with lower

costs

related to raw materials

and freight,

more than offset a slight

negative divisional

and geographical mix

in revenues,

as well as

the adverse impacts

from changes in exchange

rates.

●

Margins improved in all

divisions except in Smart

Buildings

where

profitability was slightly

hampered due to the

weakness in

residential construction

demand.

Growth

Change year-on-year

Orders

Revenues

Comparable

16%

-4%

-5%

Portfolio changes

Total

11%

—

Electrification

CHANGE

($ millions, unless otherwise indicated)

Q1 2023

Q1 2022

US$

Comparable

Orders

4,141

4,112

Order backlog

7,101

5,946

19%

24%

Revenues

3,590

3,236

11%

16%

Operational EBITA

677

512

32%

as % of operational revenues

19.0%

15.9%

+3.1 pts

Cash flow from operating activities

395

354%

No. of employees (FTE equiv.)

51,130

49,650

ABB

INTERIM

REPORT

2023

Orders and revenues

Order intake of $2,262

million reached the highest

level in

several years,

up by 3% (8% comparable)

from last year’s

high comparable. Notably,

the order intake increased

also

when separating out

the impact of larger project

orders. Book-

to-bill was 11

7%, expanding the

order backlog to

$5,102 million.

●

Positive development

for the energy efficiency

-related

drives business,

the e-mobility Traction

division and the

Service division supported

the strong overall order

growth,

while the low voltage

motor divisions declined

from last

year’s very high levels.

●

In total, customer activity

improved in all segments,

except

for weakness in

the HVAC business

due to softer

construction demand.

●

Order intake increased

in Europe by 6% (11%

comparable),

despite a double-digit decline

in Germany.

Asia, Middle East

and Africa was up by

2% (11%

comparable), as a slight

decline in China

was more than offset by

good momentum

elsewhere in the

region. The Americas was

stable (1%

comparable), including

a slight increase of 2% (2%

comparable) in the

United States.

●

Strong revenue growth

of 23%

(29% comparable)

supported by execution

of the order backlog resulted

the highest revenues

since the formation of

the Motion

business area. Significant

support from both increased

volumes and robust

price development.

Profit

Operational EBITA

of $366 million

and Operational EBITA

margin of 18.9% reached

their highest levels in

several

years.

●

Positive

earnings and margin impact

from earlier

implemented price

actions were the main driver

to the

year-on-year improvement.

●

Efficient execution

of increased volumes, supported

deliveries from the

order backlog,

contributed

significantly.

●

The margin was somewhat

supported by a positive

divisional mix as the drives

and service businesses

represented a slightly

larger proportion

of revenues, year-

on-year.

Growth

Change year-on-year

Orders

Revenues

Comparable

29%

-5%

-7%

Portfolio changes

Total

23%

—

Motion

CHANGE

($ millions, unless otherwise indicated)

Q1 2023

Q1 2022

US$

Comparable

Orders

2,262

2,202

Order backlog

5,102

4,317

18%

22%

Revenues

1,940

1,572

23%

29%

Operational EBITA

366

274

34%

as % of operational revenues

18.9%

17.4%

+1.5 pts

Cash flow from operating activities

149

(2)

n.a.

No. of employees (FTE equiv.)

21,000

20,330

ABB

INTERIM

REPORT

2023

Orders and revenues

Driven by a strong

underlying customer activity

across the

segments,

as well as by supportive

timing of some project

orders, the orders

increased by 25%

(55% comparable)

$2,113

million - the highest quarterly

level in recent history.

The

order backlog increased

to $6,893 million.

●

All divisions reported

order growth of more

than 15%

(+20%

comparable) year

-on-year. Momentum

was particularly strong

in the Energy Industries

division, including high

activity

related to new energy

sources such as hydrogen,

which

admittedly still is a

small part of the total but

growing at a high

pace.

●

Europe improved by 44

(88%

comparable), with growth

rates positively impacted

by the order de-booking

approximately $190

million in last year’s period.

Asia, Middle

East and Africa was up

by 5% (34%

comparable), with

strong

contribution from China

at 16% (52% comparable).

The

Americas was up by

29% (47%

comparable), including an

overall decline in the

United States of 9% (up 6%

comparable).

●

Total

revenue growth was hampered

primarily by the absence

the Turbocharging

division (Accelleron)

which was spun-off in

2022. That aside, a strong

customer activity and deliveries

from

the order backlog resulted

in revenues of $1,436

million, down in

total by 5% (up 15% comparable),

year-on-year.

Profit

Strong operational

performance resulted

in an Operational EBITA

margin of 14.2%, up by

120 basis points year-on

-year,

more than

offsetting the adverse

margin impact of 140

basis points related to

the exit of the high-margin

Accelleron business.

●

Significant gross

margin improvement was

the main contributor

to the strong operational

performance.

●

Operational EBITA

margin increased in

all divisions except for

a slight decline in Marine

& Ports, which was somewhat

impacted by an adverse

mix due to lower share

of revenues

stemming from the

arctic marine propulsion business.

●

All divisions were well

into double-digit margin

territory.

Particularly strong

year-on-year improvement was

noted in

Measurement & Analytics

which benefited from

a positive mix

in deliveries.

Growth

Change year-on-year

Orders

Revenues

Comparable

55%

15%

-7%

-5%

Portfolio changes

-23%

-15%

Total

25%

-5%

—

Process Automation

CHANGE

($ millions, unless otherwise indicated)

Q1 2023

Q1 2022

US$

Comparable

Orders

2,113

1,692

25%

55%

Order backlog

6,893

6,190

11%

21%

Revenues

1,436

1,506

-5%

15%

Operational EBITA

205

196

as % of operational revenues

14.2%

13.0%

+1.2 pts

Cash flow from operating activities

112

87%

No. of employees (FTE equiv.)

20,500

21,920

ABB

INTERIM

REPORT

2023

Orders and revenues

Order intake amounted

to $1,001 million, declining

by 23%

(20% comparable)

from the high order level

last year, which

benefitted from pre-buys

in a period of a strained supply

chain. While orders

increased from the fourth

quarter,

somewhat of a hampering

effect from customers

outside of

the automotive segment

adjusting inventory

levels was

noted,

particularly in China.

●

Orders declined

at a double-digit rate in both divisions

and all regions.

In total, book-to-bill was 107%

and order

backlog increased to

$2,782 million.

●

Orders were positively

impacted by favorable

development in the

automotive segment.

This was

however offset

by declines across other

segments and

primarily for machine

builders, from last year’s

very high

level.

●

With no material supply

chain constraints, execution

the order backlog supported

the strong revenue growth

28% (35% comparable).

Both divisions benefitted from

strong double-digit

comparable growth, with

contribution

from both higher volumes

and solid pricing actions.

Profit

Operational EBITA

close to tripled

year-on-year and

amounted to $140

million, supported by

higher production

output and favorable business

mix, which triggered

820 basis point margin

improvement to 14.9%.

●

Significantly higher

volumes in production improved

cost

SEC Form 6-K filed by ABB Ltd