ZURICH — Swiss-Swedish engineering giant ABB announced Wednesday that profits plunged by a quarter last year because of the cost of overhauling its structure and activity portfolio.
ABB said net profit fell to $1.9 billion in 2015, while sales slumped 11% to $35.5 billion, as orders dropped off. The group wants to focus on its most profitable sectors after embarking earlier on a vast restructuring program, including of its energy division hit by postponements of wind and solar projects.
ABB had also announced in September a $1 billion cost-cutting plan by the end of 2017 by increasing the productivity of its white-collar staff. Restructuring charges for the full year, however, rose to $626 million.
“We are shifting our center of gravity, fully in line with our Next Level strategy by driving organic growth in targeted segments, strengthening competitiveness and lowering risk,” CEO Ulrich Spiesshofer said.
Spiesshofer also highlighted technological innovations, such as the launch of the collaborative robot YuMi.
Looking ahead, ABB struck a cautious note, pointing to a mixed macroeconomic and geopolitical climate.
“Some macroeconomic signs in the U.S. remain positive, and growth in China is expected to continue, although at a slower pace than in 2015,” the company said in a statement. “The market remains impacted by modest growth in Europe and geopolitical tensions in various parts of the world.”
Copyright Agence France-Presse, 2016