By John Revill
ZURICH (Reuters) - ABB
ABB, which makes industrial robots and power grids to transmit electricity, said its net profit rose 30 percent to $681 million in the three months to the end of June, beating forecasts of $631 million in a Reuters poll of 23 analysts.
But revenue growth remained sluggish, rising only 1 percent to a weaker-than-expected $8.89 billion, a performance below ABB's annual target range for a 3 to 6 percent increase in sales on a comparable basis.
ABB has missed the target in 2015, 2016 and 2017, piling pressure on Chief Executive Ulrich Spiesshofer and weighing on the company's share price which has lagged other industrial companies over the last 12 months.
The executive who has led ABB since 2013 on Thursday pointed to improvements in the company's order book, which increased by 8 percent, as well as the company's improving profitability.
ABB has lifted its profitability by simplifying its structure and cutting costs in recent years.
"These results show that our transformation over the past
years is delivering," said Spiesshofer in a statement.
Looking ahead, ABB said macro economic signals looked positive in Europe and the United States, and it expected growth to continue in China.
But the company also highlighted what it called "rising geopolitical uncertainties in various parts of the world," without going into details.
Last week U.S. President Donald Trump raised the stakes in its trade row with China, saying he would slap 10 percent tariffs on an extra $200 billion worth of Chinese imports, including numerous consumer items.
Trump has also slapped import duties of 25 percent on steel and 10 percent on aluminium on grounds of national security. The higher prices hurts ABB's transformer and electric motor factories in the United States.
The European Union has responded by proposing a raft of quotas and tariffs to prevent it being flooded with steel imports that were no longer heading for the United States.
(Reporting by John Revill, editing by John Miller)