ABB Ltd. (ABB) Q1 2022 Earnings Call Transcript

For the period ending March 31, 2022

April 21, 2022 4:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Ann-Sofie Nordh

Greetings to all and welcome to the presentation of ABB's First Quarter Results. Most of you know me by now, I am Ann-Sofie Nordh, Head of Investor Relations. And next to me here I have our CEO, Bjorn Rosengren; and our CFO, Timo Ihamuotila. Like always they will take you through the presentation after which we open up for Q&As.

But before we begin, I would like to draw your attention to the information regarding Safe Harbor notices and our use of non-GAAP measures on Slide 2 of the ABB presentation. This conference call will include forward-looking statements and these statements are based on the company's current expectations as certain assumptions and are therefore subject to certain risks and uncertainties.

And with that, I will hand you over to Bjorn and Timo to take you through our results.

Bjorn Rosengren

Thank you, Ansi [ph]. And a warm welcome from me as well. I want to start off with a few highlights from the quarter. First, I was really good to see the customers remain very active. Our orders reach $9.4 billion, the highest quarterly level in recent years. These strong orders, and the top-line somewhat hampered by component shortages resulted in a book-to-bill of 1.35. And it was actually our fifth consecutive quarter with a positive book-to-bill.

The margin of 14.3% was good. Admittedly, it was supported by low corporate cost. But looking at operations, we had three business areas which performed well. Then we had underperformance in robot and discrete automation. But I expect this to improve from here on, that is of course, assuming external challenges do not escalate. These are uncertain times with many moving factors. Inflation is at levels that we have not seen in many years. The terrible war in Ukraine is weighing on all of our minds. We have a global imbalances in the supply chain, and now also the whole comprehensive COVID lockdowns in China. These are challenges our businesses must deal with on a daily basis. On the whole, we have managed well so far.

Then I want to mention that we have formed a new division in Electrification. We have separated the service business to his own division to improve transparency and accountability to drive both growth and profitability. This was initiated by Tarak and Morten will now follow through as he looks over the business area leadership as from this month. On that topic, I am pleased to see that both Tarak and Morten have come off to a running start in their new roles. And I look forward to them both driving performance to the next level.