ABB Q2 profit misses poll on strengthening U.S. dollar
ZURICH, July 26
ZURICH, July 26 (Reuters) - Engineering firm ABB said positive developments in China and the strength in the United States helped it grow more positive about the future, even as it missed expectations with its second quarter profit due to exchange rate fluctuations.
The firm, which makes components for the oil and gas industry and is also increasingly focusing on green technology, said on Thursday net income in the second quarter amounted to $ 656 million, weighed down by a strengthening of the U.S. dollar. Analysts polled by Reuters had expected profit to fall 18.5 percent to $728 million.
"Therefore, management is cautiously optimistic that the business environment over the remainder of 2012 will support continued growth and profitability in line with its 2011-2015 targets," ABB said in a statement.
The firm, which supplies cables to wind farms in the North Sea, is dependent on big infrastructure spending, which has not been strong of late as global growth proves sluggish and governments curtail spending.
Siemens, Europe's biggest engineering conglomerate, is set to report figures later in the day, with new orders of its flagship products seen softening as Europe wrestles with its debt crisis.
During the second quarter, ABB higher orders in key power and automation businesses in China, reversing after a weak performances there earlier in the year, as economic growth slowed there. Yet surging demand in Chinese factories for automation is a boon for makers of such equipment as sensors, frequency converters, conveyor belts, pneumatic systems, which includes ABB. (Reporting by Catherine Bosley)