Swiss power giant ABB expects revenues across all its business operations to fall in the first quarter and is no longer providing full-year guidance due to the impact of the COVID-19 pandemic.
The company said the exact hit for the first three months could not be determined yet but added that operational EBITA margins are also expected to decline, burdened by lower volumes which will be offset by “self-help efforts”.
The “company is significantly intensifying mitigation measures and actively reducing all non-essential costs, and all of ABB’s businesses are rigorously focused on serving their customers while sustaining cash flow”.
The majority of production facilities remain fully or partially operational and supply chain impacts have so far been minimal.
“However, the outbreak is expected to continue to have an impact globally, potentially creating disruption across production sites and further curtailing product demand, project and service activity,” the company said in a statement.
“ABB is accelerating and extending its mitigation measures ahead of what looks set to be a difficult second quarter, with a focus on adjusting capacity to meet reduced demand.”
The outfit is working towards completing divestments of its power grid division by the end of the second quarter.
“I would like to take this opportunity during these extraordinary times to thank the whole ABB team for sticking together and handling this global pandemic with the highest level of professionalism,” said ABB chief executive Bjorn Rosengren.
“The health and safety of all stakeholders, above all our employees, remains our number one priority at this moment in time, while we also try our utmost to secure business continuity. We remain prepared for any scenario and will take strong action to mitigate the impact for our customers, shareholders and employees.”
“Furthermore, the Board of Directors and the Executive Committee of ABB have decided to voluntarily take an immediate 10 percent reduction in board compensation and salary for the duration of the crisis, with the view to extend this strong sign of solidarity to other senior management levels within the company. We must stay strong together for the whole of ABB and for our society. The money saved through the compensation and salary reductions will be donated by ABB towards efforts aimed at fighting the impacts of the Coronavirus crisis” said the CEO.
“After many of my first meetings since joining ABB earlier this year, my impressions of the company and its people are very positive. ABB is a strong company, with a tremendous spirit and the right products and technology to drive the positive and sustainable development of the world in the future,” Rosengren added.