ABB June quarter net profit rises 34.9% to Rs75 crore
Mumbai: ABB Ltd on Thursday reported a 34.9% jump in net profit to Rs75.1 crore in the quarter ended June as compared to the same quarter last year, on the back of a 6.1% rise in revenue to Rs2,361.5 crore and a 120 basis points (bps) expansion in earnings before interest, tax, depreciation and amortisation (Ebitda) margin to 6.6%.
ABB follows a January to December reporting cycle.
The company said despite large order flow remaining muted because of customers holding back ahead of the implementation of the goods and services tax (GST), its order book still grew by 13% during the quarter.
“Base orders were the key contributor with industry turning to improving operational efficiencies through technology and digital upgrades including robotics automation,” ABB said in a statement. As of June, its order book stood at Rs12,094 crore, which provides strong visibility for revenue growth in the future, it added.
What’s interesting though is the fact that ABB’s revenue grew in the June quarter despite three out of the four segments it operates in—robotics and motion, industrial automation and power grids—registering lower revenue as compared to the quarter ended June 2016. A solid 20% growth in revenue from the electrification products segment, however, more than made up for this.
The half-year balance sheet presented by ABB also revealed that the company continues to work on its strategy of better flows even at the expense of revenue.
While its receivables had dropped from a high of Rs3,390.9 crore in the year ended 2015 to Rs3,063.3 crore in 2016, it has dipped further to Rs2,826.5 crore as of June 2017.
“Lean management, relentless pursuit of cash over revenue, and similar initiatives as part of operational excellence yielded savings and superior cash position,” the company added.